DNO Balances Kurdistan Investment With Norway Exploration

23 Feb 2018 Issue: 61 / 8 By: Waylon Fairbanks

The Norwegian firm plans to boost its Iraqi Kurdistan spending 50% to $250mn in 2018. With Peshkabir field set to surpass 30,000 b/d by summer, oil prices up year-on-year and KRG payments seemingly stable, higher revenues are expected. But is DNO too reliant on Kurdish crude?

Few success stories have emerged from Iraqi Kurdistan in recent months. Kurdish private firm KAR (and by extension, the KRG) lost 280,000 b/d of output when Iraqi forces retook Kirkuk last October (MEES, 20 October 2017). Taq Taq field (operated by Anglo-Turkish firm Genel), which produced 130,000 b/d in 2Q 2015, continued its massive slide and is now producing a mere 15,000 b/d. Total production fell from 560,000 down to its current 330,000 b/d in a matter of months. And never mind the ongoing political crisis (MEES, 26 January).

But developments at the Tawke license (DNO 75%op, Genel 25%) buck the trend as a rare source of positivity in the region. Output at the license edged up from 107,000 b/d to 109,000 b/d in 2017 as DNO switched focus from the main Tawke field to the “low hanging fruit” of the smaller Peshkabir field within the Tawke license. With major gains planned at Peshkabir, Tawke license output could average 120,000 b/d in 2018. (CONTINUED - 812 WORDS)