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Lukoil is eyeing for more supplies from Iraq
22 Mar 2015
Vagit Alekperov, chief executive of Russian oil producer Lukoil, stated that the company will ask Iraq for more oil return on the West Qurna-2 project, otherwise it will cut investments.
The Iraqi government reimburses costs incurred by Lukoil with oil as part of the project. Oil companies have proposed cuts to development spending in Iraq after Baghdad told them that low oil prices and the fight against Islamic State had made payments difficult.
Last month, letters were sent to oil companies, stating that the cuts should not decrease the present production level.
According to a senior Iraqi oil ministry official, BP proposed a cut to $3.25 billion from $3.5bn, Lukoil to $2.1bn from $2.3bn, while Exxon Mobil said it planned to maintain development spending at $1.8bn.
Alekperov hopes for avoiding cuts, by discussing solutions with Iraq.
"I hope it won't happen... Iraq needs the construction of an export oil pipeline and an increase in production so I am confident we will find a way to reach an agreement," he said.
Thanks to West Qurna-2, production abroad rose to account for 10 per cent of Lukoil's overall output last year, up from 4.4pc in 2013. West Qurna-2 currently produces more than 320,000 barrels per day (bpd) out of Lukoil's total of around two million bpd.
West Qurna-2 output is expected to peak at 1.2m bpd. Alekperov remarked that he expected Lukoil’s 2014 dividend to be equal to 2013’s dividend, at least.
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22 Mar 2015
Vagit Alekperov, chief executive of Russian oil producer Lukoil, stated that the company will ask Iraq for more oil return on the West Qurna-2 project, otherwise it will cut investments.
The Iraqi government reimburses costs incurred by Lukoil with oil as part of the project. Oil companies have proposed cuts to development spending in Iraq after Baghdad told them that low oil prices and the fight against Islamic State had made payments difficult.
Last month, letters were sent to oil companies, stating that the cuts should not decrease the present production level.
According to a senior Iraqi oil ministry official, BP proposed a cut to $3.25 billion from $3.5bn, Lukoil to $2.1bn from $2.3bn, while Exxon Mobil said it planned to maintain development spending at $1.8bn.
Alekperov hopes for avoiding cuts, by discussing solutions with Iraq.
"I hope it won't happen... Iraq needs the construction of an export oil pipeline and an increase in production so I am confident we will find a way to reach an agreement," he said.
Thanks to West Qurna-2, production abroad rose to account for 10 per cent of Lukoil's overall output last year, up from 4.4pc in 2013. West Qurna-2 currently produces more than 320,000 barrels per day (bpd) out of Lukoil's total of around two million bpd.
West Qurna-2 output is expected to peak at 1.2m bpd. Alekperov remarked that he expected Lukoil’s 2014 dividend to be equal to 2013’s dividend, at least.
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