The deal will be formalized today in a ceremony in which Zhenhua Oil is expected to commit to building an “oil residential complex” in Iraq’s East Baghdad oilfield, a super giant.
A spokesman for Iraq’s oil ministry disclosed that it had reached an initial deal with China’s state-run Zhenhua Oil to develop the southern portion of the East Baghdad oilfield.
In a statement, Asim Jihad stated, Iraq seeks to increase the output of the East Baghdad oilfield to 40,000 barrels per day within the next five years and has sought Zhenhua Oil’s expertise for this purpose.
As per an estimate by the country’s oil officials, the East Baghdad oil field, a “super giant”, has nearly 8 billion barrels of crude. It aims to produce 120,000 barrels of oil per day from this oil field.
Under the terms of the initial deal, which will be announced later on Monday, in a formal ceremony, Zhenhua Oil will commit to building an “oil residential complex”.
According to officials from the country’s oil ministry, boosting the production of crude from the East Baghdad oil field will help feed nearby refineries and power stations; it will also help free up oil for exports purposes.
The bulk of the oil produced from Iraq’s southern region is exported.