IHS, a consultancy firm, has undertaken a study and concluded that Iraq’s oil reserves may be twice as vast as current estimates. The most comprehensive study, ever since the US-led invasion of 2003, estimates that Iraq could hold twice the oil as its current capacity and could double the production in five years.
The company’s Iraq Atlas, to be released on 9th of May, estimates the current reserves at 116 billion barrels. IHS’s study claims that there could be potential 100 billion barrels lying underneath country’s western desert. If confirmed, this would make Iraq world’s second largest oil source behind Saudi Arabia and ahead of Iran.
Ron Mobed, president and chief operating officer of HIS, said:
Iraq’s reserves are clearly phenomenal. Once the infrastructure is in place, the oil will come out of the ground quite cheaply. Geologically, it’s right up there, a gold star opportunity.
The IHS study is based on analysis of geological surveys. It used data collected in Iraq both before and after the invasion. The Iraq Atlas provides most accurate details till date of the reserves field by field. In particular it reviews:
1. All proven and in-place reserves by reservoir.
2. Estimates of remaining recoverable oil and gas reserves by reservoir by the end of 2006.
3. Location maps and structure maps for fields and prospects, along with maps of the new bidding round blocks.
4. New discoveries in Iraqi Kurdistan.
5. The Western Desert of Iraq, which is believed to be holding 100 billion barrels of oil and large amounts of gas.
IHS also said that Iraq is capable of doubling it’s per day output, from 2 billion barrels a day (bpd) to 4 bpd, within five years, provided that investment comes in and security situation improves. Iraq’s government has estimated that it would need $20bn-$25bn of investment from foreign companies to get production up to its full potential.
The current Oil production in Iraq is stuck at around 2 million bpd, well down on the nearly 3 million bpd hit in the final days of Saddam and even further from the 3.7 million bpd pumped in 1979, prior to the Iran-Iraq war. Of Iraq’s 78 oilfields identified as commercial by the government, only 27 are currently producing. A further 25 are not yet developed but close to production, and 26 are not yet developed and are far from production.
This study, if confirmed, would be a great news coming from a country torn by the ongoing civil war. More oil reserves would certainly provide rest of the world with an added incentive to push for a quick settlement in Iraq.
Source: smh
