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Dragon Oil Plc confirmed that a consortium including Dragon Oil has been awarded an exploration, development and production contract (EDPSC) for Block 9 in Iraq's fourth bidding round.
Block 9 is in the Basrah province. Unlike the three previous bid rounds, which offered contracts to foreign energy firms to boost output at existing oil and gas fields, this time Iraq auctioned acreage earmarked for exploration.
Dragon Oil jointly bid with Kuwait Energy and the Turkish Petroleum Corp. (TPAO), the national oil company of Turkey, in respect of Block 9. Kuwait Energy will be the operator in the EDPSC for the block, participating with 40% contractor share; with TPAO, 30%; and Dragon Oil, 30%.
If Block 9 is found to be commercial during the five-year exploration period, the consortium may make an application to the Iraqi government to develop the block over a 20-year development period.
The consortium's bid for Block 9 was awarded on the basis of a remuneration fee of $6.24 per barrel of oil equivalent. Compared to the previous bid rounds in Iraq, there was no stipulated plateau production target for blocks awarded in this bid round.
Further details on this matter will be given at the time of release of the company's 2012 interim financial statements.