BAGHDAD (AFP) – Iraq reported on Monday a sharp rise in proven oil reserves that saw it leapfrog Iran into third place worldwide, as the war-battered country seeks to rebuild its crude-dependent economy.
The new figure of 143.1 billion barrels of oil represents a 24-percent increase over the old level of 115 billion barrels, but still leaves Iraq ranking behind Saudi Arabia and Venezuela in terms of known reserves, according to OPEC data.
“Iraq’s oil reserves which are extractable are 143.1 billion barrels,” Oil Minister Hussein al-Shahristani said at a news conference in Baghdad, noting this excluded any reserves in the autonomous region of Kurdistan.
A further 33.486 billion barrels was non-extractable, said Shahristani.
Iraq, he added, now had 66 oilfields, including seven supergiant fields, with 71 percent of all reserves concentrated in the south, 20 percent in the north and nine percent in the centre.
Shahristani said known reserves at the West Qurna supergiant oilfield now totalled 43 billion barrels, making it the second biggest oilfield in the world.
The minister noted most of the increase in reserves came from West Qurna and nearby Zubair.
He said details of the new figures would be passed on to the Organisation of Petroleum Exporting Countries later on Monday, but some analysts raised concerns over the newly reported levels.
“In the longer term, bigger reserves mean a bigger production quota since reserves are one of the factors used to calculate the (OPEC) members’ relative production quotas,” Ruba Husari, the founder and editor of iraqoilforum.com, told AFP.
“But the announcement is bound to raise questions within OPEC as to the methodology used to confirm the new reserves.”
Husari said the announcement “came as a surprise because there has been little activity to justify it and whatever is currently being carried out at some of the fields in southern Iraq, such as 3-D seismic surveys, is still in the early stages.”
Energy analysts previously said they expected the figure of 115 billion barrels to rise, as little to no exploration was conducted during the rule of now-executed dictator Saddam Hussein.
Iraq depends on crude oil exports for 95 percent of government revenue, and is trying to upgrade outdated infrastructure and spur economic growth after being crippled by decades of conflict and sanctions.
Nationalisation of the Iraq Petroleum Company was begun by the Baath party in 1972, seven years before Saddam took power, from which time little technological advancement has occurred in the industry here.
Iraq currently produces about 2.4 million barrels of oil per day (bpd), but last year awarded contracts with foreign energy firms to exploit 10 oilfields in the hopes of upping its production as much as five-fold.
As part of its plan to ramp up output, it is seeking to build up its infrastructure for energy exports, though analysts have said its target of upwards of 10 million bpd in the coming years is too high.
Last month, Iraq signed a deal with Turkey to extend its use of the Ceyhan pipeline for a further 15 years, and also reached an agreement with Syria to build two pipelines connecting it to Mediterranean sea ports.
Iraq is also looking to increase its production of gas, with a public auction slated for October 20 where international companies can bid for the rights to exploit three gasfields.
As with the country’s two oilfield auctions last year, successful companies are paid fixed prices, not a share of the profits.
The country’s parliament has yet to pass a key hydrocarbons law, however, discussion of which has been repeatedly delayed.
Adoption of the law, which would regulate the sector and divide responsibility between Baghdad and Iraq’s provinces, has been held up for three years due to disagreements between MPs from the country’s various communities.