bp has a long history of oil exploration and production in Iraq. This history stretches back to the 1920s when the company that would eventually come to be known as bp helped Iraq locate, produce and export oil from Baba Gurgur, Kirkuk. This was the largest oilfield in the world at that time. The collaboration in Iraq continued up to the early 1970s, with the Zubair field discovered in 1948 and the super-giant oilfield, Rumaila, in 1953.
In 2009, bp became the first international oil company to return to Iraq after a period of 35 years. Between 2003 and 2006, bp conducted a technical evaluation of the Rumaila field with the Ministry of Oil and in 2009, bp and PetroChina were awarded a technical service contract (TSC) to increase production at Rumaila, in partnership with the state-owned South Oil Company, recently renamed Basra Oil Company (BOC).
Today, bp, PetroChina and BOC are working in partnership to develop Rumaila, the second-largest producing field in the world, estimated to have around 17 billion barrels of recoverable oil remaining.
bp provided technical assistance to the North Oil Company to aid the redevelopment of the Kirkuk field. Kirkuk is estimated to have around 9 billion barrels of recoverable oil remaining.
bp’s philosophy in Rumaila is founded on a recognition that all our partners make a hugely positive contribution: we are privileged to be working with the Iraqi people. They bring a significant depth of knowledge and an extraordinary determination to succeed. bp is bringing world-class technology, processes and systems, helping to lay the foundations for long-term success in Iraq.
The 25-year TSC was signed between BOC and bp, PetroChina and the State Oil Marketing Organization, setting out the framework to redevelop Rumaila and significantly increase production output.
In June 2010, the Rumaila Operating Organisation (ROO) was formed as an unincorporated joint venture between these organizations, with the remit to operate and redevelop the field, with bp as the lead contractor. In September 2014, the TSC was extended by another five years to service the field through to 2034. Today, more than 7,000 people (94% of them Iraqi) from BOC, bp and PetroChina and more than 22,000 contractors (most of whom are from Basra) support Rumaila’s operations.
With bp’s guidance, the operation has made substantial progress under ROO’s stewardship: over 5 billion barrels of oil has been produced since 2010. Production has increased 40%, rising at its peak to over 1.5 million barrels per day, so that Rumaila now delivers around a third of Iraq’s oil.
From the outset, the safety of the people working at Rumaila has been our number one priority. We introduced mandatory personal protective equipment, ‘control of work’ safety processes and world-class, 24-hour medical care for all staff working at the field. Over 221 km2 of land has been cleared of unexploded ordnance and more than 3.2 million m2 of oil-contaminated land has now been remediated and brought back to use.
The field has also been transformed over the past 10 years. The number of performing wells has more than doubled, with the majority of Rumaila’s oil now coming from reactivated previously ceased wells and 385 newly drilled wells. A new headquarters, supply base, training academy and an extension to the water treatment plant have all been constructed, alongside a new 150MW electricity plant that provides power to the field and the Iraq national grid. A digital oilfield has been created, with data captured in real time from wells, facilities and pipelines to guide decision-making. New separating vessels have been installed in degassing stations to maintain the high quality of crude oil, and facilities across the field have been upgraded and modernized.
Rumaila is now a more advanced oilfield. bp has invested billions of dollars in new equipment and systems and put global experts to work. For example, 3D seismic surveying with bp proprietary technology has given an unprecedented geological understanding of 9,000 cubic kilometres of subsurface terrain. This investment and expertise have significantly increased revenues to Iraq, helping the nation to re-build its economy. As one of the largest producing fields in the world, we believe Rumaila is a model of what can be achieved in Iraq.
Rumaila is a supergiant oil field requiring significant investment to continue to modernize and deliver future production growth – vital revenue for the government of Iraq and its people. Therefore, bp and PetroChina have signed an agreement to establish Basra Energy Company Limited (BECL), an incorporated joint venture (IJV). BECL is intended to own and manage their interests at the Rumaila field, subject to relevant approvals and clearances. BECL will enable optimized and continued investment throughout the duration of the existing technical service contract – due to expire at the end of 2034 – including enhanced access to external financing.