Key Production Growth Target Achieved at Iraq’s Zubair Field
10-percent Zubair field production growth since Eni, Occidental Petroleum and KOGAS Consortium contract signing
Production increase allows consortium to commence expenditure cost recovery
Production on target to increase by more than 1 million barrels of oil per day
LOS ANGELES–(BUSINESS WIRE)– Eni, Occidental Petroleum Corporation (NYSE:OXY) and Korea Gas Corporation (KOGAS) announced today that they have achieved and sustained a 10-percent increase in oil production at the Zubair field, near Basra in southern Iraq.
Production from the Zubair field has grown to more than 200,000 barrels of oil per day from the approximately 183,000 barrels of oil a day produced when the consortium started field operations in the first quarter of 2010.
The consortium, led by Eni (32.81%) with partners Oxy (23.44%), KOGAS (18.75%) and the Missan Oil Company (25%), signed a technical service contract in late January to redevelop the Zubair field with Iraq’s state-owned South Oil Company (SOC) and Missan Oil Company as State Partner.
With the successful 10-percent increase in initial production, the consortium’s contract cost recovery mechanism commences, with the group additionally earning $2 per barrel on the incremental oil production.
The consortium plans to increase production from the Zubair field to 1.2 million barrels of oil a day, representing an increase of about 1 million barrels of oil per day. Target production is expected to be reached progressively within the next six years and maintained for seven years thereafter.
Oxy’s success in Iraq is a direct result of an outstanding partnership with the Iraqi government and our consortium partners in developing one of the world’s great oilfields,î said Dr. Ray R. Irani, Chairman and Chief Executive Officer of Occidental Petroleum. ìWe are proud of our initial results in Iraq as well as our continued success in numerous other projects across the Middle East.î
The redevelopment of the Zubair field, one of the largest discovered fields in the world, will support Iraq in becoming a major player in global oil markets. It also will foster social and economic development at a regional and national level, by providing training and development opportunities for the thousands of Iraqi workers of Zubair and by promoting much-needed economic stimulus.
The Zubair Field Operating Division manages the rehabilitation and expansion project, which is staffed mainly by employees from South Oil Company with expert support from the consortium.
Occidental Petroleum Corporation is an international oil and gas exploration and production company with operations in the United States, Middle East/North Africa and Latin America regions. Oxy is the fourth-largest U.S. oil and gas company, based on equity market capitalization. Oxy’s wholly owned subsidiary, OxyChem, manufactures and markets chlor-alkali products and vinyls. Occidental is committed to safeguarding the environment, protecting the safety and health of employees and neighbouring communities and upholding high standards of social responsibility in all of the company’s worldwide operations.
Forward Looking Statements
Statements in this release that contain words such as “will,” “expect” or “estimate,” or otherwise relate to the future, are forward-looking and involve risks and uncertainties that could significantly affect expected results. Factors that could cause results to differ materially include, but are not limited to: exploration risks, such as drilling of unsuccessful wells, global commodity pricing fluctuations and supply/demand considerations for oil and gas; higher-than-expected costs; operational interruptions; political risk; and not successfully completing (or any material delay in) any capital expenditure. You should not place undue reliance on these forward-looking statements which speak only as of the date of this filing. Unless legally required, Occidental does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise. U.S. investors are urged to consider carefully the disclosure in Occidental’s Form 10-K, available through the following toll-free telephone number, 1-888-OXYPETE (1-888-699-7383) or on the Internet at http://www.oxy.com. You also can obtain a copy from the SEC by calling 1-800-SEC-0330.
Occidental Petroleum Corporation
Richard S. Kline, 310-443-6249 (media)
Chris Stavros, 212-603-8184 (investors)
Source: Occidental Petroleum Corporation
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