Iraq Oil production targets 500,000 barrel per day export increase by May

1. Reuters – Iraq aims to boost oil exports by 200,000 barrels per day next month after it opens up a new Gulf outlet, a senior Iraqi oil official said, freeing Baghdad to export all the extra barrels foreign oil companies are extracting from its giant fields.

If all goes to plan, exports from Iraq’s southern oilfields will rise to 1.9 million bpd by March – pushing overall oil sales to 2.3 million bpd – a postwar record.

An average monthly increase of 100,000 bpd is expected from March until mid-year, when maximum rates of 2.2 million bpd are reached in the south. Shipments of northern Kirkuk crude are expected to remain steady at around 400,000 bpd.

“Our target is to reach overall exports of 2.6 million bpd by May, provided everything is working properly,” the Iraqi official said asking that their name not be used in the run-up to the inaugeration of the SPM.

Rumaila, Iraq’s biggest producer, is now churning out 1.35 million bpd, up from an average 1.14 million bpd last year . West Qurna-1 is producing roughly 390,000 bpd and Zubair is around 250,000 bpd,

Rumaila will provide the biggest slug of new oil in the early stages of Iraq’s oil expansion, which involves 11 megaprojects and an official target of 12 million bpd.

Widely-flagged infrastructure and logistical hurdles mean capacity of 6 million bpd is more likely. Rumaila’s contractual target is to hit 2.85 million bpd by 2017.

Before tapping Rumaila’s green field, which will account for its biggest growth, BP must overhaul existing equipment that dates back to the 1970s and before.

2. Reuters – Sanctions on Iran over its nuclear plans are already hitting oil production in the Islamic Republic and a fall in its output and exports is likely to accelerate, industry analysts say.

Oil industry analysts forecast Iranian oil output will fall by as much as 9 percent this year to an average of around 3.3 million barrels per day (bpd).

Iranian oil production has fallen over the last two years by more than 250,000 bpd, or 6.6 percent, and could lose more than 300,000 bpd this year and a further 200,000 bpd in 2013, Vienna-based consultants JBC Energy estimate.

The IEA cited some industry estimates that up to 1 million bpd of Iran’s 2.6 million bpd of exports could be replaced by alternative supplies once EU sanctions begin.

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