Iraq's South Oil Co Issues Tender to Drill 16 Oil Wells

Jul 09, 2007 (Dow Jones Newswires)

The Iraqi South Oil Co., an affiliate of the oil ministry, has issued a new tender to drill or complete drilling 16 oil wells in southern Iraq, the company said on its Web site.

It said the closing date for companies to offer their bids is by the end of office on July 10.

It gave no further details.

An official from the SOC said that the 16 wells are scattered in fields near the border with Kuwait and in Amara oil fields.

The South Oil Co., responsible for Iraq's production and export operations in southern Iraq, said that it had drilled and completed 165 oil wells in the Basra and Amara oil fields in the south of the country in 2006. It also said that it's planning to drill more than that number in 2007.

Iraq sits on the world's third largest oil reserves but is struggling to maintain its energy sector. It depends almost entirely on its southern oil terminals for exports because sabotage and security problems have severely disrupted oil production in the north.

Iraq's oil exports stand at an average of 1.5 million barrels a day, well below its potential because of a lack of investment, sabotage and years of neglect under sanctions before the U.S.-led invasion in March 2003.

The country is waiting for parliament to approve an oil and gas law that is expected to allow foreign companies to start investment in the country's vast oil fields.

Copyright (c) 2007 Dow Jones & Company, Inc.