Oil production in Iraqi oil fields in the south of the country is falling by an average of 7% per year. The problem: a high water cut that is forcing South Oil Co. (SOC) engineers to shut down wells one after the other. But as they lose the old wells in West Qurna, Rumaila, Zubair, Majnoon and Nahr Bin Umar, the drilling of new ones to replace them is not catching up at the same speed.
Iraq Drilling Co (IDC) has just finished installing two new rigs in Majnoon and South Rumaila and is in the process of commissioning them. By the end of June, it should have another four new ones and 12 more by the end of the year. In total, IDC should have acquired 26 brand new rigs by 2010 to help save the fields …and the country’s coffers. According to an accelerated program designed by SOC veteran Jabbar Luaybi and adopted by the council of ministers in February, the drilling of 120 wells in six of the southern fields should not only put an end to the sliding production, but also increase it by 300,000-400,000 b/d by the end of 2010. The question is: Can IDC deliver on time?