Dana Gas, one of the largest private natural gas companies in the region, and Crescent Petroleum, its affiliate, said gas production from their operations in the Kurdistan region of Iraq surged 50 per cent compared to 2018 levels to reach a record 452 million cubic feet of gas per day (MMscf/d) at the end of 2021.
The growth in production is supported by a number of process improvements at the gas plant in Iraqi Kurdistan, including a bypass project completed in 2020 as well as a de-bottlenecking programme earlier in 2018, the two companies said in a joint statement on Wednesday.
“Our continued investments since 2018, notably the Khor Mor de-bottlenecking and bypass projects, have allowed us to deliver reliable supplies of clean energy to support the KRI economy and its people, with enhanced economic and environmental benefits which will increase as we further grow production,” said Patrick Allman-Ward, chief executive of Dana Gas.
Dana Gas and Crescent Petroleum jointly operate the Khor Mor and Chemchemal gasfields on behalf of the Pearl Petroleum consortium, supplying gas that is used to generate electricity in the KRI. It also produces nearly 16,000 barrels of condensate and 1,000 tonnes of liquefied petroleum gas per day.
Global oil and gas investments are expected to increase more than 4.3 per cent annually to reach $628 billion this year as the industry recovers from the pandemic and from the hurdles posed by the Omicron variant, consultancy Rystad Energy said in a recent report.
Brent, the international benchmark under which two thirds of the world's oil trades, was up 0.7 per cent at 1.11pm UAE time trading at $84.31. West Texas Intermediate, which tracks US crude prices, was trading 0.9 per cent higher at $81.95.
Dana Gas payments from Egypt and Kurdistan jumped 107 per cent in 2021 on higher oil prices, the company said last week. Oil prices rose more than 50 per cent last year as global economies recovered from the Covid-19 pandemic and Opec+ group of countries restrained production.
The Sharjah-based company, which owns a 35 per cent interest in Pearl Petroleum, said its share of collections from sales of condensate, gas and liquefied petroleum gas in Kurdistan jumped 80 per cent to $184 million in 2021.
The process improvements at Khor Mor will be reinforced by a $630m expansion project, which is currently being executed and will increase total capacity by an additional 55 per cent by April 2023, according to the statement.
“The achievement of this production milestone underscores the progress we continue to make at Khor Mor to meet the rapidly growing demand for natural gas in the KRI,” said Majid Jafar, chief executive of Crescent Petroleum and board managing director of Dana Gas.
Major works to expand the Khor Mor project resumed in April last year after suffering a one-year delay owing to the pandemic. The project will drill up to five development wells, which are scheduled to commence production in March.
Despite the challenges the world has faced over the past two years, Dana Gas “continued delivering uninterrupted supply of clean-burning natural gas to support the KRI economy”, Mr Jafar said.
The company swung to a net profit of $279m in nine months ended September 30, 2021, on higher oil prices, improved operational performance and other income.