Elf, Gaz de France and Agip in talks with Iraq for $ 1 bn gas project

Nov 03, 1999 01:00 AM

France's Elf and Gaz de France (GDF) and Italy's Agip are in talks with Baghdad for a gas project in sanctions-hit Iraq worth more than $ 1 bn, an Elf official said. "Elf recently began negotiations with the oil ministry to develop five gas fields in Kirkuk," some 255 km (160 miles) to the north of Baghdad, an unnamed official said.
"Agip and GDF are negotiating with Iraq for the construction of the gas pipeline" to Turkey "that would run next to the Iraqi-Turkish oil pipeline," the official added. The gas fields under discussion are Anfal, Chemchamal, Jaria-Pika, Khashm al-Ahmar and Mansuriya, all in the regions of northern Iraq held by Kurdish rebel groups in defiance of Baghdad.
The planning director at the oil ministry, Faleh al-Khayat, said in 1997 that the five fields had estimated reserves of 270 bn cm (9.45 tcf) of gas and would cost $ 680 mm to develop. He also estimated the cost of building a new 1,300 km (800-mile) gas pipeline at just over $ 1 bn, of which Iraq would pay $ 380 mm and Turkey the rest.
Iraq opened its gas sector up to foreign firms in 1997 with three large projects on offer, including the Iraqi-Turkish gas pipeline with an annual capacity of 10 bn cm (350 bn cf) of gas. Iraq's total gas reserves are estimated at 5 tcm (175 tcf), of which 3.1 tcm (108 tcf) are proven.

Meanwhile, the Elf official said his company was awaiting "a political decision" to start development work on the massive Majnun oil field in the south of Iraq. "Elf is at the last stage of negotiations with Iraq, the contract is balanced and will greatly profit Iraq, whose capacity will increase by 700,000 bpd " once Majnun comes on line, he said.

Source: AFP via Iinoil
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