UAE’s Pearl Petroleum raises Dh917m to invest in Iraqi project
Funds will be used to increase gas production capacity by 50 per cent
Pearl Petroleum Co, a consortium led by the UAE’s Dana Gas and Crescent Petroleum, has raised $250 million (Dh917.5 million) in financing from the US International Development Finance Corporation (DFC) to support the gas expansion works in the Khor Mor gas plant in the Kurdistan Region of Iraq (KRI).
The funds will be used to increase gas production capacity by 50 per cent to 690 million standard cubic feet (scf)/day to meet the rising demand for clean natural gas for electricity generation and industry in KRI.
The total project cost is $630 million (Dh23 billion), and the remaining financing has already been secured through a regional bank facility and the EPC contractor.
The KM-250 project is the first stage of a two-train expansion project at Khor Mor that aims to boost total production capacity to approach 1 billion scf/day.
Work resumed in April 2021 after onsite construction was halted last year due to the Covid-19 pandemic and is currently on track for completion by April 2023.
“Despite the global challenges presented by the Covid pandemic, we have continued to maintain our record of uninterrupted operations and even managed to grow production. The DFC agreement is a testament to our successful track record and further highlights the potential of these resources and the bright future for the KRI,” said Majid Jafar, CEO of Crescent Petroleum and managing director of Dana Gas, commented:
The total investment by Pearl Petroleum at Khor Mor to date exceeds $2.1 billion with a total cumulative production of over 341 million barrels of oil equivalent (boe) in natural gas and liquids.
The uninterrupted supply of gas to power plants in Erbil, Chemchemal and Bazian has resulted in significant fuel cost savings and economic benefits for the Kurdistan Region and Iraq.
“DFC’s investment in the Khor Mor expansion will substantially increase access to energy for people all across the Kurdistan Region of Iraq. This highly developmental project represents the United States’ continuing investment in the Kurdistan Region,” said Dev Jagadesan, acting CEO of DFC.
Between 2018 and 2021, the Khor Mor Gas Plant also benefitted from a 45 per cent production increase through an optimisation of the facility bringing current total production to 106,000 barrels of oil equivalent per day (boepd). The project is today the largest regional private sector upstream gas operation in Iraq.
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