Russia’s Lukoil — in partnership with Japan’s INPEX — announced last month that it has made an important discovery at the Eridu-1 exploration well in Block 10, about 150 kms west of Basra.

According to a 22 February press release issued by Lukoil, the well recorded a flow rate of more than 8,000 b/d of sweet oil, confirming geological expectations of a large hydrocarbon field presence within the block at the Mishrif horizon. The company confirmed that exploration in the block is continuing and that the 2017 work programme includes the drilling and testing of the additional Eridu-2 appraisal well.

Lukoil and INPEX were awarded exploration rights at the 5,600 km² block in the 2012 licensing round, with the companies holding 60% and 40% stakes, respectively.

This is clearly positive news for Iraq and bolsters its estimated oil reserves. Oil minister Jabar al-Luaibi had announced earlier in February that Iraq’s oil reserves had increased from a previous estimate of 143 billion barrels to 153 billion barrels. The increase is the result of appraisals and exploration carried out at seven oil fields in central and southern Iraq. He added that Baghdad would request OPEC to adopt the new figure as its official reserves estimate.

Tribal trouble

Work in Lukoil’s block is, however, aggravating existing tensions in southern Iraq. In particular it is reigniting old problems between the governorates of Dhi Qar and Muthana.

These two neighbouring governorates have been embroiled in a dispute dating back many years, but which reached a peak between 2009 and 2012. The dispute was over Dhi Qar’s demands that Muthana provide it with proper access to Iraq’s border with Saudi Arabia, which Muthana was reluctant to concede. The dispute was only calmed when Baghdad intervened, but the tensions have continued to simmer.

Lately they have resurfaced, seemingly triggered by the increased oil exploration activity in Block 10, which lies on the border between Dhi Qar and Muthana. There is a tug of war, with the dominant tribes from each governorate in the border area claiming that they have the right to jobs in the oil sector.