Baker Hughes to drill Iraq's W. Qurna by early '12

Baker Hughes to drill Iraq’s W. Qurna by early ’12

"We have the rigs already so it is just up to customers to tell us when to start drilling, we have already mobilized rigs, we are on track."

October 3, 2011 4:25 by Reuters

Baker Hughes International is on track to start drilling in Iraq’s giant West Qurna oilfield by early 2012, a senior executive at the world’s third largest oilfield services firm said.

“Drilling activities in Iraq will probably start toward the end of the fourth quarter or beginning of next year, depending on the customer’s schedule,” Khaled Nouh, president of Baker Hughes’ Middle East business, told Reuters in an interview.

“We have the rigs already so it is just up to customers to tell us when to start drilling, we have already mobilized rigs, we are on track.”

The U.S.-based company — which opened an operations base in Basra in 2010 — said in August 2011 it had won a two-year contract from the field operators to provide full drilling and completion services for 23 wells at West Qurna in southeast Iraq.

Russia’s LUKOIL and Norway’s Statoil got the 20-year deal to develop the West Qurna Phase Two in a December 2009 auction, pledging to boost output to 1.8 million barrels per day (bpd) in six years. The field has estimated reserves of 12.9 billion barrels.

GROWTH PROSPECTS

Nouh said BHI’s drilling activity in the Middle East would be mainly focused in Saudi Arabia, Egypt and the United Arab Emirates for the rest of 2011, while Saudi Arabia and Iraq offer the highest potential for short to medium-term growth.

Iraq’s plan to dramatically increase oil output over the next few years is expected to cause a boom in drilling activity, sharply driving up demand for drilling rigs in the Middle East, analysts say.

Meanwhile, BHI could also grow as Gulf Arab states tap unconventional hydrocarbon resources to maintain their oil production or raise gas output to meet their own energy needs domestically.

“I think it became a mandate to go into unconventional plays, it is no longer an option, the industry will have to find gas in places that was not tapped before,” Nouh said. (Reporting by Reem Shamseddine, editing by Daniel Fineren and Keiron Henderson)