Iraq's Energy Industry
Oil reserves145 billion barrels
Oil Production4.1 million bopd
Gas reserves3.5 tcm
Gas production9.4 bcm
Iraq: Emerging from Uncertainty
Iraq’s oil and gas industry has remained stable during the country’s ongoing challenges and conflicts. The country remains the fourth-largest producer of hydrocarbons and the second-largest producer in OPEC. Iraq’s impressive reserves are the third largest in the world behind Saudi Arabia and Iran. The national oil and gas industry is overseen by the Ministry of Oil. The government is involved in E&P activities through the following state-owned entities: North Oil Company, Midland Oil Company, Dhi Qar Oil Company, Basrah Oil Company and Missan Oil Company.
The majority of the country’s hydrocarbons are found in the country’s eastern edge near its border with Iran. The super-fields in the southeast near Kuwait form the greatest concentration of such finds worldwide and contain more than 70-80% of the country’s reserves. About 20% of its reserves are found in the northern region. Production comes predominantly from the nation’s NOCs. The country is looking to up production from its maturing assets, which will require fresh-water injection. Given that fresh water is a rare commodity in Iraq, opportunities exist in building related infrastructure. Iraq’s impressive gas potential has also been largely overlooked, with Iraq relying on gas imports to meet demand. Work continues to bring down gas flaring and develop related transport infrastructure.
Iraq has significant refining capacity, but assets have largely become antiquated and function at around 50% capacity. The aged facilities produce more heavy fuel oil than refined products, which does not match the nation’s demand requirements. The state has discussed imposing measures to move investment focus from its oil and gas production towards developing its downstream capacities to spur direct economic growth for the country.
Another requirement for upping production on Iraq’s oil and gas fields is a rise in power generation capacity. The hydrocarbons industry traditionally takes up 10% of total energy demand in the country, which is expected to rise as output increases. Despite an almost entirely resistant hydrocarbons industry, political turmoil has taken a toll on investment in its power generation sector. Efforts to curb consumption have been made by the government, but further investment is needed to meet the country’s industrial targets.
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