Oct 9 2012

Iraq to earn $115 billion from oil sales in 2012

By Shayma Adel

Azzaman, October 9, 2012

Iraq is expected to earn $115 billion from oil sales this year, the Oil Ministry says.

The ministry’s spokesperson Asem Jihad said the surge in royalties would be the result of an increase in output made possible by developing new fields and upgrading others.

Iraqi relies almost solely on oil sales for its hard cash earnings.

Its current exports, estimated at more than 2.5 million barrels a day, are believed to be the highest in as many years.

Oil output is on way to surge to 4.3 million barrels a day, with 2.9 million reserved for exports next year.

Foreign oil majors are developing new oil fields and some of them will start production next year.

Iraq’s massive oil riches are yet to be fully developed.

Out of the country’s 78 major oil fields, only 22 are operational.

“Iraq has surprising opportunities for entrepreneurs particularly in the area of infrastructure,”  Jihad said.

If all goes well, Iraq should be producing 8 million barrels a day in 2017, added Jihad.

Iraq banks on a surge in exports for a substantial increase in earnings, which it wants to invest in infrastructure.

But analysts say all depends on prices on international oil markets. A sharp drop from current high levels of more than $100 for a barrel will make the expected increases in sales meaningless in terms of hard cash earnings.

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