Norway's DNO, ExxonMobil continue to explore for oil, gas in Iraqi Kurdistan

Dubai — Norway's DNO and ExxonMobil, partners in the Baeshiqa license in Iraq's semi-autonomous Kurdistan region, continue to explore for oil and gas in the area despite the companies' budget cuts and delays of government payments to international oil companies.

DNO said it had completed the testing and appraisal of Baeshiqa-2 exploration well and was planning the imminent spudding of an exploration well at a separate prospect, Zartik, 15 km (9 miles) southeast on the same license.

"Evaluation of the test results will determine the next steps towards further appraisal and assessment of commerciality," DNO said in a statement Wednesday.

"Baeshiqa-2 well was drilled safely, below budget and with all exploration objectives achieved. The Zartik-1 well is anticipated to spud on May 15, 2020. Site construction was completed 10 days ago on time and below budget."

In November 2019, DNO said the Baeshiqa-2 reservoir produced between 900 and 3,500 b/d with specific gravity ranging between 40 and 52 API and 8.5-15 MMcf/d of sour gas during the first phase of testing.

DNO is the operator of the Baeshiqa license with a 32% interest. Its partners include ExxonMobil with 32%, Turkish Energy Company with 16% and the Kurdistan Regional Government with 20%.

Delayed payments

IOCs operating in Kurdistan in northern Iraq have complained in recent months of delayed payments by the KRG, which has been hit hard by the oil-price crash.

DNO said in April it had received $77.2 million as payment for October 2019 crude oil deliveries to the export market from the Tawke license in Kurdistan.

DNO operates and has a 75% interest in the Tawke license which contains the Tawke and Peshkabir fields. The remaining interest is held by UK-based Genel Energy.

The Oslo-based company has stuck to its Kurdish exploration plans despite a 30% or $300-million reduction in its 2020 budget to shore up its balance sheet because of the collapse in the oil price and the coronavirus pandemic.

ExxonMobil said last month it will slash its 2020 capital spending by $10 billion as North America's largest energy company cuts deeper than the other integrated oil majors around the world.