Majnoon Field
Encyclopedia
Majnoon Oil field is a super-giant oil field
located 60 km (37.3 mi) from Basra
, Basra Governorate in southern Iraq
. Majnoon is one of the richest oil fields in the world with an estimated 23-25 billion and proven reserves of 12.6 billion of barrels of oil in place. The field was named Majnoon which means crazy in Arabic in reference to excessive amount of oil in a dense area.
, a Brazil
ian company in 1975, in a shallow Upper Cretaceous formation. Development came to a halt in 1980 during the engineering phase of the project, due to Iran-Iraq War
, particularly Operation Kheibar
. At the time, Braspetro had finished drilling of 20 wells and pressed 14 drilling rigs into service. In the course of the war, Iran
occupied and sabotaged the area. After the war, Southern Oil Company of Iraq restarted the production. In 1990's, Total S.A.
of France
negotiated a development contract with Saddam Hussein
but was unable to sign the deal due to United Nations
sanctions imposed on Iraq. The deal was eventually annulled by Hussein in 2002. Due to 2003 Iraq War, production was reduced to 46000 oilbbl/d. In 2007, Total and Chevron
signed an agreement with Iraqi government to explore Majnoon field.
On December 11, 2009, the Iraqi government awarded a license to a joint venture from Royal Dutch Shell
and Petronas
to take over operations at Majnoon Oilfield, and triple production from the estimated reserve of nearly 12.6 Goilbbl at a fee rate of $1.39/barrel. The consortium was awarded the contract out of 44 international companies, participating in the auction, with China National Petroleum Corporation
(CNPC), ExxonMobil
, Sinochem Corporation, Total specifically bidding on Majnoon field. The finalist alliance of CNPC and Total offering $1.75/barrel lost the bid. The deal intends a 20-year service and development of the field. The contract was approved by Council of Ministers of Iraq
on January 5, 2010.
hold 30% and 25% of interest. According to company officials, the project will require tens of billions of dollars over the 20-year period.
zone consists of Upper Cretaceous which proved 4000 barrels (635.9 m³) of oil per day in 1976. Mishrif carbonates, Nahr Umr sands (Middle Cretaceous) and Shuaiba carbonates and Zubair sands (Lower Cretaceous) form the pay zones.
The production at Majnoon will move Iraq from the current 11th place to the 3rd among oil producing nations after Saudi Arabia and Iran. The country sits on 115 Goilbbl of oil and currently produces 2.5 Moilbbl/d. Iraq expects to top the oil production to 7 Moilbbl/d within six year thus competing with Saudi Arabia
.
Oil field
An oil field is a region with an abundance of oil wells extracting petroleum from below ground. Because the oil reservoirs typically extend over a large area, possibly several hundred kilometres across, full exploitation entails multiple wells scattered across the area...
located 60 km (37.3 mi) from Basra
Basra
Basra is the capital of Basra Governorate, in southern Iraq near Kuwait and Iran. It had an estimated population of two million as of 2009...
, Basra Governorate in southern Iraq
Iraq
Iraq ; officially the Republic of Iraq is a country in Western Asia spanning most of the northwestern end of the Zagros mountain range, the eastern part of the Syrian Desert and the northern part of the Arabian Desert....
. Majnoon is one of the richest oil fields in the world with an estimated 23-25 billion and proven reserves of 12.6 billion of barrels of oil in place. The field was named Majnoon which means crazy in Arabic in reference to excessive amount of oil in a dense area.
History
The field was discovered by BraspetroBraspetro
Braspetro was a Brazilian state company. It was founded in 1972, as a subortinated company of Petrobras, with the responsibility to find and produce oil outside Brazil...
, a Brazil
Brazil
Brazil , officially the Federative Republic of Brazil , is the largest country in South America. It is the world's fifth largest country, both by geographical area and by population with over 192 million people...
ian company in 1975, in a shallow Upper Cretaceous formation. Development came to a halt in 1980 during the engineering phase of the project, due to Iran-Iraq War
Iran-Iraq War
The Iran–Iraq War was an armed conflict between the armed forces of Iraq and Iran, lasting from September 1980 to August 1988, making it the longest conventional war of the twentieth century...
, particularly Operation Kheibar
Operation Kheibar
Operation Kheibar was an Iranian offensive in the Iran-Iraq War. This operation was part of the Battle of the Marshes.-Prelude:After the unsuccessful Operation Dawn V in southern Iraq, Iran opened a new front at the lakes of the Hawizeh Marshes. 250,000 Iranian men swept through the Iraqi desert...
. At the time, Braspetro had finished drilling of 20 wells and pressed 14 drilling rigs into service. In the course of the war, Iran
Iran
Iran , officially the Islamic Republic of Iran , is a country in Southern and Western Asia. The name "Iran" has been in use natively since the Sassanian era and came into use internationally in 1935, before which the country was known to the Western world as Persia...
occupied and sabotaged the area. After the war, Southern Oil Company of Iraq restarted the production. In 1990's, Total S.A.
Total S.A.
Total S.A. is a French multinational oil company and one of the six "Supermajor" oil companies in the world.Its businesses cover the entire oil and gas chain, from crude oil and natural gas exploration and production to power generation, transportation, refining, petroleum product marketing, and...
of France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
negotiated a development contract with Saddam Hussein
Saddam Hussein
Saddam Hussein Abd al-Majid al-Tikriti was the fifth President of Iraq, serving in this capacity from 16 July 1979 until 9 April 2003...
but was unable to sign the deal due to United Nations
Iraq sanctions
The Iraq sanctions were a near-total financial and trade embargo imposed by the United Nations Security Council on the nation of Iraq. They began August 6, 1990, four days after Iraq's invasion of Kuwait, stayed largely in force until May 2003 , and certain portions including reparations to Kuwait...
sanctions imposed on Iraq. The deal was eventually annulled by Hussein in 2002. Due to 2003 Iraq War, production was reduced to 46000 oilbbl/d. In 2007, Total and Chevron
Chevron Corporation
Chevron Corporation is an American multinational energy corporation headquartered in San Ramon, California, United States and active in more than 180 countries. It is engaged in every aspect of the oil, gas, and geothermal energy industries, including exploration and production; refining,...
signed an agreement with Iraqi government to explore Majnoon field.
On December 11, 2009, the Iraqi government awarded a license to a joint venture from Royal Dutch Shell
Royal Dutch Shell
Royal Dutch Shell plc , commonly known as Shell, is a global oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the fifth-largest company in the world according to a composite measure by Forbes magazine and one of the six...
and Petronas
Petronas
PETRONAS, short for Petroliam Nasional Berhad, is a Malaysian oil and gas company that was founded on August 17, 1974. Wholly owned by the Government of Malaysia, the corporation is vested with the entire oil and gas resources in Malaysia and is entrusted with the responsibility of developing and...
to take over operations at Majnoon Oilfield, and triple production from the estimated reserve of nearly 12.6 Goilbbl at a fee rate of $1.39/barrel. The consortium was awarded the contract out of 44 international companies, participating in the auction, with China National Petroleum Corporation
China National Petroleum Corporation
China National Petroleum Corporation is a state-owned fuel-producing corporation and the largest integrated oil and gas company in the People's Republic of China...
(CNPC), ExxonMobil
ExxonMobil
Exxon Mobil Corporation or ExxonMobil, is an American multinational oil and gas corporation. It is a direct descendant of John D. Rockefeller's Standard Oil company, and was formed on November 30, 1999, by the merger of Exxon and Mobil. Its headquarters are in Irving, Texas...
, Sinochem Corporation, Total specifically bidding on Majnoon field. The finalist alliance of CNPC and Total offering $1.75/barrel lost the bid. The deal intends a 20-year service and development of the field. The contract was approved by Council of Ministers of Iraq
Council of Ministers of Iraq
The Cabinet of Iraq is the executive branch of the government of Iraq.The National Assembly of Iraq elects a President of State who along with two deputies form the Presidency Council. The Presidency Council appoints the Prime Minister who appoints the Council of Ministers, all of whom must be...
on January 5, 2010.
Licences
The operator Shell holds 45% stake in all licences, while Petronas and Iraqi Ministry of OilMinistry of Oil (Iraq)
The Ministry of Oil is the Iraqi government agency responsible for Iraqi petroleum. The Minister of Oil since December 21, 2010 is Abdul Karim al-Luaibi.-External links:* by Michael T. Klare, The Huffington Post, July 14 2009...
hold 30% and 25% of interest. According to company officials, the project will require tens of billions of dollars over the 20-year period.
Reservoir
Majnoon's first payPay (geology)
Pay is an expression used in hydrocarbon mining. It denotes a portion of a reservoir that contains economically recoverable hydrocarbons. The term derives from the possibility of "paying" an income surpassing the costs. Equivalent terms are pay sand or pay zone...
zone consists of Upper Cretaceous which proved 4000 barrels (635.9 m³) of oil per day in 1976. Mishrif carbonates, Nahr Umr sands (Middle Cretaceous) and Shuaiba carbonates and Zubair sands (Lower Cretaceous) form the pay zones.
Production
According to the deal, the consortium will increase production to a peak 1.8 Moilbbl of oil per day within seven-year period. Majnoon was the first Iraqi field out of 10 major ones offered to international companies for development. The contract with Shell and Petronas includes drilling over 40 production wells, construction of three gas separation stations and two crude oil processing refineries with overall capacity of 100000 oilbbl/d. The official start date was March 1, 2010. In the Phase I of the project, the consortium intends to increase the production from 45,000 to 175000 oilbbl/d within two-year period.The production at Majnoon will move Iraq from the current 11th place to the 3rd among oil producing nations after Saudi Arabia and Iran. The country sits on 115 Goilbbl of oil and currently produces 2.5 Moilbbl/d. Iraq expects to top the oil production to 7 Moilbbl/d within six year thus competing with Saudi Arabia
Saudi Arabia
The Kingdom of Saudi Arabia , commonly known in British English as Saudi Arabia and in Arabic as as-Sa‘ūdiyyah , is the largest state in Western Asia by land area, constituting the bulk of the Arabian Peninsula, and the second-largest in the Arab World...
.