China National Petroleum Corp (CNPC) has officially embarked on its first joint exploitation project of al-Ahdab oilfield with Iraq; this is also Iraq''s first new oilfield exploitation by an overseas company since the war began in 2003.

According to the website of Iraq-based Chinese commercial counselor''s office, CNPC has officially started to drill al-Ahdab oilfield last Friday (Jan 2^nd) and its governor Latif al-Tarfa said that engineers from China on this project had started working and project-related equipment would be arriving in Basra soon.

 

The project is under a 23-year, US$ 3 billion contract with the Iraqi government. The field will yield 25,000 barrels of crude oil per day within three years and 115,000 barrels per day within six years. The yielded crude oil would be mostly exported overseas and part of production volume would be fuel used to generate electricity at nearby power plants to mitigate power shortage in Iraq.

 

Latif al-Tarfa also remarked that great efforts would be taken to ensure the safety of Chinese personnel on this project.

 

As early as 1996, CNPC had inked a profits-sharing agreement on al-Ahdab oilfield with Saddam government but was put on hold by Iraqi 12-year long war. And in November 2008, CNPC officially signed with Iraq < al-Ahdab oilfield exploitation service contract>.

 

Website of Iraq-based Chinese commercial counselor''s office noted that CNPC would charge service fee of 6 US dollars for every barrel and gradually less to 3 US dollars in future.

 

Iraq is the second largest oil reserve country with total yield volume up to 11.5 billon barrels, only second to Saudi Arabia, and oil industry is the pillar industry in Iraq but was havocked great wreak by years of warfare. In June 2008, Iraqi government for the first time embarked on a bid invitation for gas/oil exploitation from overseas countries and British＆Holland Hosanna　Kerltlhex Oil Group Ltd won the bid to exploit an oil/gas field in Basra.

 

At the end of 2008, Iraq announced its second round bid inviting for oil/gas exploitation which included 11 new gas/oil fields yielding daily between 2 million and 2.5 million barrels.