Kuwait Energy, the privately owned oil and gas producer, has signed 20-year contracts to develop two gasfields in Iraq.
The production service contracts for the Siba and Mansuriya fields finalise the Iraqi oil ministry's decision last October to award licences to the foreign consortiums that submitted winning bids for the fields in Iraq's oil and gas auction.
Kuwait Energy bid jointly with the state-owned Turkish Petroleum for the rights to develop both fields and will lead the Siba project. The group to develop the Mansuriya gas deposit is led by Turkish Petroleum and also includes the South Korean state-controlled Korea Gas.
Kuwait Energy and Turkish Petroleum will seek to establish 100 million cubic feet per day (cfd) of gas output from Siba, a relatively small field in Basra province, where most of Iraq's giant southern oilfields are located. The gas will be used locally for electricity generation.
"The signing marks the beginning of a long-term partnership with Iraq, a milestone for Kuwait Energy and a step forward in Kuwait-Iraqi relations," said Sara Akbar, the chief executive of Kuwait Energy. "Along with our partners, we are very excited to start participating in the development of the country's natural gas resources."
Despite the significant reserves of gas associated with its oilfields, Basra province is short of gas for power generation because about 700 million cfd of gas pumped from the oilfields is flared as waste.