Iraq signs Halliburton deal to develop two Basra oil fields

Iraq's Basra Oil Company signed a joint management contract with Halliburton on Sunday to develop two southern oil fields, the Oil Ministry said.sana+1
The deal, in the works since early 2025, targets combined output of up to 250,000 barrels per day amid Iraq's push for a higher OPEC quota.indexbox+1
Iraq's cabinet also approved preliminary agreements with a Chevron -led consortium to study strategic oil export pipelines, according to Reuters.reuters

Iraq's state-owned Basra Oil Company signed a five-year joint management contract with Halliburton on Sunday to develop two oil fields in southern Basra province, as Baghdad pushes to expand production capacity amid a simmering dispute with OPEC over output quotas.

The Deal

The agreement covers the Nahr Bin Omar and Sindbad oil fields, the Iraqi Oil Ministry announced on Sunday. Under the terms, production at Bin Omar is expected to climb to 150,000 barrels per day over five years, along with 300 million standard cubic feet per day of associated gas, according to Oil Minister Basim Mohammed Khudair Al-Abadi. Sindbad's output is projected to reach 80,000 to 100,000 barrels per day, with associated gas rising to 240–260 million standard cubic feet daily.sana+2

The contract, structured as an Integrated Field Management and Engineering, Procurement, and Construction Management agreement, had been in the works since early 2025, when Iraq's cabinet first approved a heads of agreement with Halliburton for the two fields. Basra Oil Company will remain the primary operator, with Halliburton managing surface and subsurface projects.iraq-businessnews+2

OPEC Tensions

The deal arrives against the backdrop of Iraq's increasingly vocal demands for a larger OPEC production quota. In late June, Oil Ministry spokesperson Salim Al-Rikabi warned that "a decision will have to be made regarding whether to remain in or withdraw" from OPEC if Iraq's ceiling is not raised, according to Bloomberg. The ministry later walked back the remarks, saying reports of a potential exit "do not reflect the official position of the Iraqi Government".thenationalnews+2

Iraq's July OPEC quota stands at 4.378 million barrels per day, according to Reuters, while the International Energy Agency estimates the country could produce 4.9 million barrels per day within 90 days — a gap worth roughly $36 million daily at current prices. Iraqi Oil Minister Khudair said in May that Baghdad is seeking a quota of 5 million barrels per day.worldoil+1

Broader Ambitions

Iraq, OPEC's second-largest producer after Saudi Arabia, is targeting long-term production of 7 million barrels per day. Sunday's cabinet meeting also approved preliminary agreements with a consortium including Chevron and Qatar's UCC to study strategic oil export pipeline projects, Reuters reported.reuters+2

"Iraq's demand for a larger OPEC quota is primarily a response to mounting economic pressures," an Iraqi energy adviser told Reuters. "Export disruptions and war-related losses have increased the need for higher production".wtvbam

Sources (29)