[Haichuan Overseas Engineering] China National Petroleum Engineering Corporation signs EPCC contract for free water removal project at Rumaila Oil Field in Iraq

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Recently, the Middle East Company of China National Petroleum Engineering Corporation successfully secured a contract for the EPCC project for free water removal at the Rumaila oil field in Iraq. The Rumaila oil field is the sixth largest oil field in the world, with geological reserves of 17 billion barrels; it currently produces around 1.4 million barrels of crude oil per day. As oil fields enter the middle and later stages of development, the continuous increase in the comprehensive water content becomes a key technical challenge affecting stable production in these fields. According to industry research data, when the water content in crude oil increases from 30% to 60%, the daily oil production of a certain oil field drops sharply from 50 tons to 20 tons. An increase in moisture content not only leads to a sharp decline in oil well production but also significantly raises dewatering costs and exacerbates equipment corrosion. The DS04 FWKO project at the Rumaila oil field, the subject of this contract, is led by Basra Energy Company, a joint venture between China National Petroleum Corporation and BP. The contract duration is set at 36 months, and the main construction tasks include the installation of new free water separation and produced water treatment systems along with related facilities. The scope of services for this project encompasses all aspects of EPCC services, including detailed design, procurement, construction, commissioning, startup, and performance testing. Historical Cooperation: Looking back at the history of cooperation, in 2009, CNPC and the BP consortium won the bid for the development of the Rumaila oil field, becoming the first project to be contracted as part of Iraq’s first international oil and gas field bidding process in 30 years. Under the agreement signed in 2009, BP and CNPC will jointly invest in the development of the Rumaila oil field. The daily crude oil production of the Rumaila field is expected to increase from 1 million barrels to 2.8 million barrels. Under the agreement, in the joint venture to develop the Rumaila oil field, BP holds a 38% stake while CNPC holds a 37% stake. In 2011, the goal of increasing production by 10% was achieved ahead of schedule; in May of that year, the first shipment of 2 million barrels of crude oil was sent to China. This made it the first project under Iraq’s initial bidding rounds to achieve an increase in oil production and cost recovery, thus establishing a win-win situation for both investors and the resource-rich country. CPECC was established in 1980 and is a professional international energy engineering company directly under China National Petroleum Corporation. With a business presence in over 50 countries, it has established six stable and large-scale markets in the Middle East, Central Asia, Africa, and other regions. The company’s main business areas include onshore oil and gas field projects and natural gas liquefaction projects, and it possesses the capability to provide services across the entire industry chain. It has established deep partnerships with globally renowned energy companies such as Shell, BP, and TotalEnergies, delivering a large number of major energy projects over the years. It has won numerous national and provincial/municipal-level engineering awards, and is a highly representative international engineering force under China National Petroleum Corporation. Since entering the Iraqi market in 2010, it has remained focused on the local energy engineering sector. In the Rumaila area, oil and gas engineering services have been provided to companies such as BP, Shell, ENI, and Total. From the Rumaila oil field to the BGC market, and from the Majnoon oil field to the Basra refinery, CPECC’s services cover various key energy areas in Iraq. A total of 96 contracts have been signed. Among them, since its commissioning in June 2018, the Rumeila RPP early-stage power plant has generated a total of 2.28 billion kWh of electricity, consumed 737 million cubic meters of associated gas, thereby avoiding pollution resulting from direct combustion ； Projects such as desalination and dehydration have established a good brand image in the local market.