The Republic of Iraq is a country in the Middle East, spanning the north-western Zagros mountains, the eastern Syrian desert and the northern Arabian desert. It is bordered by Kuwait, Saudi Arabia, Jordan, Syria, Turkey and Iran. Its very narrow coast lies on part of the Persian Gulf. There are two major river systems: the Tigris and the Euphrates, which are vital resources for the country, providing it with fertile soil in contrast with the desert landscape that covers much of the region. Iraq's economy is dominated by the oil sector, which has traditionally provided about 95% of foreign exchange earnings. Iraq is a member of OPEC, though not currently subject to production quotas.
Iraq is arguably one the most abundant countries in the world in respect of hydrocarbon resources potentially available to the industry. Iraqi proven oil reserves are conservatively estimated to be in excess of 100 billion barrels. Iraqi authorities have set a production target of 6 MMbbl/d by 2013 and it is expected that the country will require significant levels of foreign investment to finance the reconstruction of its oil industry to achieve that goal.
Map of our assets
In the Kurdistan region of Iraq, our licence is onshore.
The Taq Taq field is located in the Kurdistan Region of Iraq, 60 km north of the giant Kirkuk oil field, 85 km south-east of Erbil and 120 km north-west of Sulaimaniyah. Through our participation in Taq Taq since 2005, Addax Petroleum was an early entrant into a potentially world class oil field.
In July 2005, Addax Petroleum entered into a farm-in agreement with Genel Energy (formerly Genel Enerji A.S, “Genel”) for a 30% interest in a Production Sharing Agreement (PSA) for the Taq Taq field. Addax Petroleum subsequently increased its equity position in the PSA for the Taq Taq field to 45% when it acquired an additional 15% participating interest, subject to Kurdistan Regional Government (KRG) back in rights, from Genel by way of Revised PSA in November 2006. The PSA was revised again in February 2008 in order to conform to the model Production Sharing Agreement published by the KRG. KRG subsequently exercised its right to require that a government nominated entity be assigned a 20% interest. Addax Petroleum’s participating interest in the PSA for the Taq Taq field is presently 36%, with Genel Energy holding a 44% interest, and KRG holding a carried 20% interest.
Addax Petroleum and Genel have formed an incorporated joint venture company, Taq Taq Operating Company Limited (TTOPCO) to act as operator under the PSA and conduct Taq Taq operations.
The licence area covers an area of approximately 158,101 acres (639.6 km2); the Taq Taq field is completely located within this license area and includes the main Cretaceous oil reservoir, a shallower Tertiary oil field that overlays the main reservoir, and deeper prospects in the Jurassic and Triassic which have still to be appraised.
From 2005 to 2007, TTOPCO acquired 292 km2 of 3D seismic covering the Taq Taq field. TTOPCO started to drill appraisal/development wells from 2006 - 2008, and in 2009, an early production facility was installed that allowed oil to be processed and exported by road tanker to a local market. In 2010, the central processing facility was constructed and came on stream with capacity of 60,000 bopd; in 2012, additional development wells were drilled and a temporary facility was added to give a processing capacity of 105,000 bopd. In 2012, Taq Taq production and lifting were able to exceed 100,000 bopd. International exports through the Iraq-Turkey pipeline (ITP) have taken place using road tankers to transport crude to Khurmala and Fayshkabur terminals; however, this arrangement has been intermittent due to the on-going dispute between Kurdistan and Baghdad central government and failure to agree an Iraq oil law.
In 2013, TTOPCO will continue drilling additional development wells and construct a second processing facility, to give a combined process and export capacity of up to 150,000 bopd. An export pipeline (constructed by local company KAR) will also be available to allow export to Khurmala of up to 150,000 bopd.