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OPEC’s second largest producer, Iraq, plans to increase its oil production capacity to 5.5 million barrels per day (bpd) by the end of the year, up from about 4.4 million bpd now, Iraqi Oil Minister Hayyan Abdul Ghani told the Rudaw news outlet on Wednesday.
“The plan is to reach sustainable production capacity this year at a rate of 5.5 million barrels per day through expansion in well drilling and rehabilitation operations, building surface facilities and pipelines, and increasing water injection to maintain reservoir pressure,” Abdul Ghani said.
Iraq plans further production capacity increases to have its output capacity at above 6 million bpd by 2029.
Iraq is also in discussions with Chevron over exploration blocks in Nasiriyah and Salahaddin provinces, the minister told Rudaw.
In August, Chevron and the Iraqi Oil Ministry signed preliminary exploration agreements that marked a major step toward reviving the U.S. supermajor’s presence in Iraq after years of limited engagement.
While Iraq is boosting production capacity and has just restarted exports from its northern semi-autonomous region of Kurdistan via pipeline to the Turkish Mediterranean coast, OPEC’s second biggest producer is part of the OPEC+ agreement.
As one of the members of the alliance, Iraq has been entitled to higher production quotas in recent months as OPEC+ is reversing its production cuts. Iraq, however, has not raised output as much as it is allowed to, because it is one of the producers having to compensate for previous overproduction.
According to OPEC’s latest monthly report from September, Iraq produced 4.015 million bpd of crude oil in August, up by 122,000 bpd from July, per the secondary sources the cartel uses to track output.
Not including production in the Kurdistan region, Iraq self-reported to OPEC crude oil output of 3.742 million bpd for August, up by 50,000 bpd compared to July, OPEC’s report showed.
The restart of Kurdistan’s crude exports weighed earlier this week on oil prices, which dipped by 2% on Monday.
