Iraq Plans to Raise Official Estimate of Crude Reserves

Iraq’s government will announce tomorrow that the country’s crude oil reserves are larger than the current estimate of 115 billion barrels, an oil ministry spokesman said.

Oil Minister Hussain Al-Shahristani will disclose the revised figure at a news conference in Baghdad, Asim Jihad said in a telephone interview in the capital.

“The new figure will be important and will reflect Iraq’s true crude oil potential,” Jihad said.

Iraq’s oil reserves currently rank fourth in size after those of Saudi Arabia, Canada and Iran. Many oil-industry executives and analysts believe Iraq to have large unexplored reserves, particularly in the country’s western regions, that it was unable to detect and quantify during years of conflict and economic sanctions.

Iraq depends on oil sales for most of the foreign currency it needs to rebuild and modernize the economy, and the government is seeking foreign investors to help boost crude output.

Production has suffered from insurgent attacks since the U.S.-led invasion of 2003 ousted the regime of Saddam Hussein. The resulting interruptions in the flow of oil from northern Iraq have added to long-standing problems of under-investment and outdated technology.

In an effort to revitalize the industry, the government last year awarded 12 development contracts to international oil companies. It plans a separate bidding round this month to start exploiting natural-gas reserves.

Iraq produces about 2.4 million barrels of oil a day, according to data compiled by Bloomberg. Iraq’s oil output will increase 4.2 percent by the end of the year, Shahristani said on Sept. 22.

Bloomberg