IRAQ-OIL/OUTPUT Iraq's southern oil output averaging about 3 mln bpd - oil minister

Record ID: 344584

  • Title: IRAQ-OIL/OUTPUT Iraq's southern oil output averaging about 3 mln bpd - oil minister
  • Date: 15th November 2014
  • Summary: BAGHDAD, IRAQ (NOVEMBER 15, 2014) (REUTERS) ****WARNING CONTAINS FLASH PHOTOGRAPHY*** MAYORS OF IRAQI PROVINCES IN MEETING VARIOUS OF MAYORS AT MEETING IRAQ'S OIL MINISTER, ADEL ABDUL MEHDI, WALKING INTO NEWS CONFERENCE ROOM (SOUNDBITE) (Arabic) IRAQI OIL MINISTER, ADEL ABDUL MEHDI, SAYING: "Of course the average daily production in Iraq sometimes exceeded 3 million barrels per day; we may sometimes reach 3.2 million barrels per day. Some of it goes to domestic refineries for local consumption. The numbers are unstable; the average exports also climbed to an average of about 2.5 million barrels per day." MAYORS ATTENDING MEETING WITH MINISTER (SOUNDBITE) (Arabic) IRAQI OIL MINISTER, ADEL ABDUL MEHDI, SAYING: "The price (of oil) has dropped sharply from 106 (dollars per barrel) and even more to 79 dollars for a barrel. If we deduct the cost of transportation and some other costs the prices will be less than that by five to six dollars. Definitely this is a huge drop which has to be treated. I think that recent solutions including a cut in the government's spending are part of the attempts to reduce the impact caused by the drop in oil prices." REPORTER ASKING QUESTION (SOUNDBITE) (Arabic) IRAQI OIL MINISTER, ADEL ABDUL MEHDI, SAYING: "After the deal, which was reached two days ago (with the Kurdistan region) we expect Iraq's output to double to compensate for the loss caused by the drop in oil prices. We have to put this agreement into effect in order to get back revenues of Kirkuk's oil production and (oil) production of the Kurdistan region to Iraq's budget." NEWS CONFERENCE IN PROGRESS
  • Embargoed: 30th November 2014 12:00
  • Keywords:
  • Location: Iraq
  • Country: Iraq
  • Topics: General
  • Reuters ID: LVA2H7T69Q5K3BDS94RT6B7W0AQI
  • Story Text: Iraq's current southern oil output is averaging about 3 million barrels per day (bpd) and average export levels stand at about 2.5 million bpd, the country's oil minister said on Saturday (November 15).
    The output and export levels indicate that fighting and unrest has not derailed an expansion of supplies from OPEC's second-largest producer.
    "Of course the average daily production in Iraq sometimes exceeded 3 million barrels per day, we may sometimes reach 3.2 million barrels per day," Adel Abdel Mehdi told reporters at a news conference. "Some of it goes to domestic refineries for local consumption. The numbers are unstable; the average exports also climbed to an average of about 2.5 million barrels per day."
    Iraq's southern production capacity has been fluctuating, sometimes reaching 3.4-3.5 million bpd.
    The price of oil has also dropped significantly and Abdel Mehdi said the government was trying to limit the impact that this is having on the country.
    "The price (of oil) has dropped sharply from 106 (dollars per barrel) and even more to 79 dollars for a barrel," he said. "If we deduct the cost of transportation and some other costs the prices will be less than that by five to six dollars. Definitely this is a huge drop which has to be treated. I think that recent solutions including a cut in the government's spending are part of the attempts to reduce the impact caused by the drop in oil prices."
    Iraq is facing its gravest crisis since the fall of Saddam Hussein in 2003. Islamic State militants swept through the north in June almost unopposed by the army.
    The ultra-hardline group has seized oil and petroleum products in an attempt to create a self-sustaining caliphate. U.S. air strikes in recent weeks have helped prevent Islamic State from making further advances.
    The government of Iraq and the semi-autonomous region of Kurdistan reached a deal this week to ease tensions over Kurdish oil exports and civil service payments from Baghdad.
    Under the agreement, Iraqi Kurdistan will give 150,000 barrels per day of oil exports - equal to around half its overall shipments - to the federal budget.
    Abdel Mehdi predicted that the deal would double Iraqi output.
    "After the deal, which was reached two days ago (with the Kurdistan region) we expect Iraq's output to double to compensate for the loss caused by the drop in oil prices. We have to put this agreement into effect in order to get back revenues of Kirkuk's oil production and (oil) production of the Kurdistan region to Iraq's budget," said the minister.
    Baghdad stopped paying for KRG civil servant salaries in protest against the Kurds' exporting oil to Turkey independently.
    Under the agreement, Iraqi Kurdistan will give 150,000 barrels per day of oil exports - equal to around half its overall shipments - to the federal budget.
    A spokesman for the Kurdistan regional government in the north said the Baghdad government would not gain control of Kurdish exports.
    Exports from Iraq's southern terminals averaged 2.55 million barrels per day (bpd), according to shipping data for the first 23 days of October tracked by Reuters. An industry source who monitors the exports had a similar estimate.
    Iraq's oil supplies were held back by decades of war and sanctions. It has been expanding oil production in the south since Western companies signed a series of service contracts with Baghdad in 2010, and boosted export capacity.
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