Kuwait Energy signs Export Oil Sales Agreement for Iraq’s Block 9

4/12/2016

KUWAIT CITY -- Kuwait Energy has signed an Export Oil Sales Agreement for Iraq’s Block 9.

The agreement, signed between a consortium led by Kuwait Energy and Iraq's State Oil Marketing Company (SOMO), puts in place the mechanism by which Kuwait Energy will be paid for services in Block 9.

The signing ceremony took place in SOMO’s Baghdad headquarters and was attended by Majid Al-Hilfi of SOMO; Sara Akbar, CEO of Kuwait Energy; Ibrahim Fathy, assistant deputy CEO for development and reservoir production, Egyptian General Petroleum Corporation; and Asri Mousa, representing Dragon Oil Holdings Ltd from the partners side.

The agreement will enable allocation of crude cargoes to be sold in compensation for the services that the consortium is rendering in Block 9. Kuwait Energy is expected to be allocated its first cargo of oil entitlement for the company’s working interest share from the Faihaa-1 well covering the production of oil from October 2015 to March 2016.

“Today marks an important milestone in Kuwait Energy’s history and its Iraq operations in particular, as this agreement will facilitate receiving revenue from our Iraq operations after five years of Kuwait Energy’s work and investment in Iraq,” said Akbar.

In 2013, Kuwait Energy was awarded the Block 9 Exploration, Development & Production Service Contract (EDPSC) in southern Iraq as operator and currently holds a 60% participating interest.

The first exploration well in Block 9 was spud in March 2014, and led to significant oil discoveries in September and December of the same year. Oil production commenced from the Block in October 2015, only a year after the first discovery was made.

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