Iraq picks Petrofac for $95 million contract

Iraq picks Petrofac for $95 million contract

Iraq has picked British oil services firm Petrofac for a $95 million contract to carry out maintenance work for its new offshore terminals and sub-sea pipelines at the Gulf, an Iraqi oil official said on Monday.

June 18, 2012 6:12 by Reuters

Under the contract, Petrofac should conduct maintenance work to ensure there are no leakages in the pipelines or any faults at the two new single point mooring (SPM) terminals that may delay the loading of crude, the official said.

Three companies were short-listed by the state-run South Oil Company to bid for the project, including Italy’s Saipem and Australian construction firm Leighton Holdings .

“Petrofac’s offer was picked up for the service contract and the one year extendable contract has been referred to the oil minister for final approval,” the oil official, who declined to be named, said.

Iraq has planned for four new SPM terminals which are being built by Leighton and are expected to help it in doubling crude output in the next few years.

The opening of two SPM terminals this year has eased export constraints and boosted oil exports significantly.

Baghdad has signed a series of contracts with foreign oil companies that target total oil production capacity of 12 million barrels per day (bpd) by 2017 – up from about 3 million bpd.

Most analysts see 6 million to 7 million bpd as a more realistic goal.

OPEC-member Iraq is expected to be a major source for future oil supplies.