Iraq laid out more milestones on its path back to oil producing power, targeting 6 million barrels per day exports by 2017, and confirming it was currently pumping more than neighbor and fellow OPEC member Iran.
Iraq’s Oil Minister Abdul-Kareem Luaibi said on Saturday he expected oil exports will reach 2.9 million bpd next year before hitting 3.5 million bpd in 2014 and 3.75 million bpd in 2015.
Current production is at 3.2 million bpd, the highest level in three decades, and exports are at an average of 2.6 million bpd.
“We expect exports for this month to be more than 2.6 million barrels per day. So far they are at 2.6 million barrels per day, and output is at 3.2 million,” the minister told reporters.
Iraq with the help of foreign firms has ambitious plans to boost production capacity beyond 12 million bpd by 2017, but this target has proved unrealistic due to infrastructure bottlenecks and logistical shortcomings.
It is expected to target 8-8.5 million bpd, but some oil analysts and executives see even 6 million bpd by 2017 as a stretch for the war-damaged country.
Any rise in Iraqi supplies would replace shortages of Iranian crude from the market and could keep a lid on prices as Western sanctions targeted Iran’s exports.
Recovering from decades of war and crippling sanctions, Iraq is seeking to boost its oil flows. The bulk of its crude oil is exported from southern Gulf ports.
With ambitious plans to double its oil production over the next three years, Iraq has passed the 3 million bpd production level for the first time in three decades and has overtaken Iran to become OPEC’s second biggest oil producer after Saudi Arabia.
“Iraq production now is at 3.2 mln bpd and we managed to outpace Iran production in OPEC due to the deteriorated Iranian production,” Falah al-Amri, Iraq’s OPEC governor and head of the State Oil Marketing Organization, told reporters on the sideline of an oil conference in Baghdad.
Iraq’s oil exports rose to 2.565 million barrels per day (bpd) on average in August, their highest level for three decades.
Iraq’s central government and the autonomous Kurdistan reached a deal, announced on Thursday, to end an oil payment dispute after Kurdistan pledged to continue exports and Baghdad said it would pay foreign companies working there.
Under the agreement, Kurdistan said it would keep its oil production for export at 140,000 barrels per day this month before raising it to 200,000 bpd for the rest of the year, levels that could significantly further boosting Iraq’s exports.
If the deal stands, it will be a limited breakthrough in a broader long-running dispute over land, energy resources and authority to sign energy contracts between the central government and the Kurdistan region.
Luaibi said investment in Iraq over the last two and a half years to develop oilfields awarded to foreign companies in three auctions had reached to around $15 billion, a healthy figure but still below the government’s ambitions.
Iraq holds the world’s fourth largest oil reserves.