The Republic of Iraq is said to hold 115 billion barrels of proven oil reserves. Of that, 8.7 billion barrels of oil reserves are derived from Kirkuk. It is second in Iraqi oil production behind Basra. In Kirkuk there is a "superfield" where 7.5 percent of Kirkuk's oil is derived. Kirkuk oil in and out of the superfield contributes 12.1 percent to the total oil reserves of Iraq. There are six sites in Kirkuk, with four of them producing oil. The other two are undeveloped or new. Kirkuk Field consists of three domes that extend 62.14 miles from the southeast to the northwest. Oil from the Northern Kirkuk Superfield is considered a low-quality, heavy crude, because of how the oil is extracted.
Types of Oil
Paraffin-base crude oils are higher in molecular weight and is solid at room temperature. They are considered heavy or extra heavy crude. The lighter properties are eliminated by oil-eating bacteria, water or air--an undesirable effect.
Asphalt-based crude oils contain little or no paraffin and are also called light crude and is priced higher. Mixed-base crude are where most oils are categorized. They have paraffin, naphthenes and aromatic hydrocarbons.
Discovered in 1927, Kirkuk oil is considered heavy crude and uses a nontraditional processing method. It has an American Petroleum Institute or API density rating at 35 because it is dense with saltwater and has a sulfur content of nearly two percent (1.97) and several heavy metals in it. These properties make it expensive to process and pump out. Its consistency is compared to heavy molasses, according to Battelle.org, an environmental website.
Light crude oil is more desirable than heavy oil since more gas can be derived from it. Of that, sweet oil commands a higher price than high sulfur oil because it has fewer environmental problems, and requires less refining to meet sulfur standards imposed in various markets.
Oil Field Management Issues
Reservoir mismanagement issues over the past 20 years, have nearly depleted the Kirkuk oil wells. Kirkuk crude oil is of lower quality due to misuse of the oil well and not following the proper guidelines for maintaining the well. Water, steam, carbon dioxide or other chemicals are injected into to the oil reservoir to artificially get it to flow because the natural pressure is depleted. This oil is considered "gas-stripped." It's more expensive to extract, according to an article on OilGasArticles.com.
However, as proven reserves of light and sweet crude oil are depleted, there is a growing interest in developing oils like Kirkuk oil, because it is what is at hand.
There is an an ongoing struggle between oil companies and the governments that regulate them, as both parties have different ways of achieving the same goal: high-producing wells. When government attempts to curtail dangerous oil field practices, oil companies complain about red tape and bureaucracy, according to a report on the Iraq Revenue Watch website.
Postwar Production of Kirkuk Oil
Actual production at the Kirkuk Field started in 1934 and up to this point has produced 62 percent of its total reserves. It is at the final stages of its life. It produces 470,000 barrels each day, according to 2006 figures. It will be half that amount ten years from now, and less than 100,000 barrels a day 25 years from now, according to a report on the Iraq Revenue Watch website.
Kirkuk Super Field Oil Study
Revamping production policies are recommended according to the Kirkuk Super Field Oil Study, a report on the Iraq Revenue Watch website said.
The Iraq Oil Ministry in Iraq appointed Shell Oil Co. to study the Kirkuk field. The study
will make it possible to create a production policy that will examine the extraction efficiency from the oil field.
A 2008 analysis in Energy Daily, the Oil Ministry is in the final stages of negotiations with Shell, reportedly to pay $500 million for technology, equipment and training to boost oil production from the entire Kirkuk Field by 100,000 barrels per day by 2010.
According to the Shell website, about a third of the oil in any reservoir can be produced economically. Wells are usually depleted after that and require the extraction processes similar to that in Kirkuk. Shell Oil says advanced technologies they have developed can increase output.
Effects of Smuggling
Severe oil infrastructure problems lead to many flourishing smuggling operations that will in turn bankrupt the country, according to a report by the Iraqi Oil Ministry Office of the Inspector General.
"Smuggling Crude Oil and Oil Products" is a report issued in 2005 on the issue of smuggling.
Not only does it cost billions each year, it damages the pipelines and oil refineries which affects the quality of the oil.
The way to stop it is to police land and sea ports, arrest and prosecute offenders and begin a plan to shore up the oil distribution system accurately and consistently, the report said.
Reference
- Oil Gas Articles
- Battelle.org
- Iraq Revenue Watch
- Iraq Revenue Watch: Smuggling Crude Oil and Oil Products
- Energy Daily
Resource
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