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Iraq has agreed contract terms with bp for the redevelopment of oil fields at Kirkuk, with work expected to begin in 2025

The deal will see bp invest in various Kirkuk fields, providing oil, gas, power and water rehabilitation work, with the potential for investment in exploration too.

The agreement — subject to final government ratification — is for an initial phase and includes production of more than three billion barrels of oil equivalent (boe). It includes the Baba and Avanah domes of the Kirkuk oil field and three adjacent fields – Bai Hassan, Jambur and Khabbaz – which are currently operated by the North Oil Company (NOC).

In a statement, bp said that the “wider resource opportunity” across the contract and surrounding area is up to 20 billion boe. The value of the work is expected to be worth in the region of US$25bn over the contract period, according to news agency Reuters.

“This agreement builds on our longstanding and strategic relationship with the Iraq government and delivers access to a material new resource opportunity, within one of the world’s most prolific hydrocarbon provinces,” said bp executive vice president William Lin.

The news comes after bp announced that it would ramp up oil and gas production, and scale back renewables investments, as part of a revised growth strategy focusing more on hydrocarbons.

Under the terms of the agreement, bp’s remuneration will be linked to incremental production volumes, price and costs.It will also be able to book a share of production and reserves proportionate to the fees it earns for helping to increase production.

New operator

The intention is to to set up a new operator, initially an unincorporated organisation comprising predominantly of personnel from NOC and North Gas Company (NGC), with secondees from bp. This will take over operations at Kirkuk from NOC, although bp said it later expects to form a standalone incorporated joint venture to hold its interests in the operator. Its first priority will be to stabilise and grow production, with work set to include a drilling programme, the rehabilitation of existing wells and facilities, and the construction of new infrastructure, including gas expansion projects.

bp said the investment will bring opportunity and growth to the Kirkuk region, as well as improving supply chain capability alongside job creation.

“It will enable us to bring our experience of managing giant fields to realise the potential of this important asset for Iraq, working alongside and in close partnership with NOC and NGC,” added Lin. “This opportunity is fully in line with our priority of pursuing new growth opportunities for bp as we strengthen and high-grade our portfolio across the world.”

The deal follows a memorandum of understanding signed by bp and Iraq in July 2024, of which technical terms were agreed in December and the majority of commercial terms in January.

bp has a long history at Kirkuk, supporting NOC and the Iraq government on technical studies between 2013 and 2019  to explore the potential for redevelopment. It was also a member of the consortium of firms that discovered oil at Kirkuk in the 1920s.

Precision engineering group Hunting PLC has announced it is looking to grow its presence in the Middle East with the construction of a small laboratory in the UAE to service clients in the Eastern Hemisphere

This will enable sample lead time and overall analysis time to decrease as a result of closer proximity to the customer, according to the company, which has operations in the UAE and Saudi Arabia as well as other global locations. Hunting sees the Middle East as a key area of growth, given the tender activity across the region, according to its 2024 Results statement.

Hunting’s recent announcement of the acquisition of the Organic Oil Recovery (“OOR”) enhanced oil recovery technology from its founding shareholders, for US$17.5mn, also has the potential to boost this expansion, as it will allow the company to accelerate commercialisation across North America and the rest of the world. Hunting will pay a 15% royalty to the sellers on revenue earned for a period of 15 years, post-completion.

The Organic Oil Recovery process is a proven and innovative enhanced oil recovery technology which optimises reservoir performance and recovery rates.

This breakthrough technology, which manipulates the resident down-hole ecology, offers operators an easy-to-deploy advanced tertiary oil recovery resulting in increased production and the lowering of lifting costs. It also lowers the water cut during end-of-life production, lowers hydrogen sulphide levels in production offtake and extends the life and increases the economic returns of a producing field.

Field trials of the OOR technology are currently underway with numerous blue-chip exploration and production companies across the Middle East, North America, Europe and Asia Pacific. Over 340 successful applications onshore and offshore have been reported, with an overall success rate of 94%.

Hunting has secured up to US$60mn of orders from operators in the UK North Sea, with a strong pipeline of opportunities likely to be secured internationally in the coming years, as the oil and gas industry becomes aware of the production benefits of the solution.

Given the prevalence of mature fields in the Middle East, and the challenges of trapped oil, steep production declines, excessive water production and H2S which the OOR technology addresses, there would appear to be strong potential for expansion in the region.

Jim Johnson, chief executive of Hunting, said, “Following the acquisition of this exciting business, Hunting now has the ability to deploy this remarkable technology globally. The technology is currently being evaluated by many blue-chip customers, with the benefits to the operator clear. For Hunting, the business will be margin accretive and strongly position the company to reach its Hunting 2030 Strategy targets in the medium term as commercialisation accelerates.”

As the world pivots towards a low-carbon future, the petrochemical industry finds itself at a crossroads, balancing growth prospects with evolving regulatory and sustainability challenges

The global energy transition is reshaping industries, compelling them to integrate clean energy solutions alongside their continued reliance on fossil fuels. While much of the focus has been on the deceleration of oil and gas consumption as primary energy sources, petrochemicals remain a critical segment with sustained demand projected well into the coming decades.

This sector, heavily dependent on fossil fuel-based feedstocks, produces essential chemicals that form the backbone of numerous industries, including plastics, fertilizers, and pharmaceuticals. Unlike transportation fuels, whose consumption forecasts have fluctuated, petrochemicals are expected to witness steady demand with fewer disruptions. The International Energy Agency (IEA) projects that petrochemicals will account for more than a third of oil demand growth by 2030, primarily driven by rising consumption in developing economies. In India, for example, demand for key petrochemicals such as ethylene and propylene is expected to increase two- to three-fold over the next two decades, fueled by urbanisation, industrial expansion, and the drive for decarbonisation.

Complex sustainability imperatives

However, this growth trajectory exists alongside increasing scrutiny of the industry’s environmental footprint. Governments and regulatory bodies worldwide are tightening climate policies, imposing restrictions on single-use plastics, and advancing circular economy initiatives. As a result, petrochemical producers must navigate complex sustainability imperatives while maintaining competitiveness.

The environmental impact of petrochemical production has become a focal point for policymakers, investors, and consumers. The industry accounts for approximately 18% of global industrial carbon emissions, with energy-intensive processes such as refining and steam cracking being major contributors. Key challenges include:
• Regulatory pressures: Carbon pricing mechanisms, plastic bans, and stricter emissions controls are being implemented globally, increasing production costs and pressuring profit margins.
• Circular economy and recycling: Advances in chemical recycling, biodegradable alternatives, and closed-loop manufacturing systems threaten to reduce reliance on virgin petrochemical feedstocks, reshaping traditional demand patterns.
• Investor sentiment: ESG-focused investment strategies are compelling oil majors and petrochemical producers to present credible decarbonisation roadmaps, with capital allocation increasingly favouring companies with sustainable practices.

To ensure long-term viability, petrochemical producers are exploring multiple strategic pathways:
• Feedstock diversification: Investments in bio-based and recycled feedstocks are gaining traction as companies seek to lower emissions and align with sustainability goals.
• Carbon capture and utilisation (CCU): The integration of CCU technologies is emerging as a key solution to mitigate emissions, though economic feasibility remains a challenge.
• Advanced materials innovation: Research into high-performance polymers, biodegradable plastics, and alternative chemicals is accelerating, offering new avenues for growth beyond conventional petrochemicals.
• Integration with renewable energy: Shifting production facilities towards renewable power sources and hydrogen-based processes is becoming a priority for reducing the sector’s carbon footprint.

The petrochemical industry stands at a pivotal juncture, balancing robust demand with the imperative to adapt to a rapidly evolving regulatory and sustainability landscape. While traditional growth drivers remain intact, companies that embrace innovation, diversify feedstocks, and integrate low-carbon solutions will emerge as industry leaders. The coming decade will serve as a litmus test for the sector’s resilience, ultimately shaping its role in a decarbonising world.

This article is authored by Synergy Consulting IFA.

Abu Dhabi-based AI pioneer AIQ has won a US$340mn contract with ADNOC to deploy its agentic AI solution ENERGY^ai  across ADNOC’s upstream value chain, following the successful completion of a proof-of-concept phase

The three-year contract will see ENERGY^ai and a suite of related AI solutions rolled out across all ADNOC’s upstream assets, comprising more than 28 producing fields, in ADNOC’s drive to become the world’s most AI-enabled company.

Built on 70 years of proprietary data and knowledge, ENERGY^ai combines large language model (LLM) technology with cutting-edge agentic AI, which is trained for specific workflows across ADNOC’s upstream value chain. ENERGY^ai brings a new level of efficiency and precision to critical tasks, from seismic analysis to geological modelling and real-time process monitoring, reducing time for essential business processes from months to days, minimising cost, and reducing emissions in the process.

The POC trial demonstrated that ENERGY^ai's agentic AI can deliver significant improvements in the pace and accuracy of upstream exploration through rapid, precise and detailed seismic survey analysis, alongside relevant, actionable insights to support production optimisation at ADNOC’s existing wells.

The first operational, scalable version of ENERGY^ai is expected to be completed in mid-2025. It will include five fully operational AI agents covering tasks within subsurface operations and will be test-deployed across several upstream assets, with plans to scale its application to thousands of additional wells. 

Magzhan Kenesbai, acting managing director, AIQ said, “This contract marks a defining moment for AIQ. In partnership with ADNOC, we have developed a world-first agentic AI solution that is scalable across the entire energy value chain and has the potential to transform the industry as we know it. We are proud to see ENERGY^ai move from a successful proof-of-concept to full deployment, enabling ADNOC to unlock unparalleled efficiencies, reduce carbon intensity, and advance their sustainability ambitions. This achievement reflects our commitment to delivering innovative, high-impact AI solutions that not only meet the challenges of today but also shape the future of energy.”

Speaking at CERA Week in Houson, ADNOC managing director and Group CEO Dr Sultan Ahmed Al Jaber said,"Today, we have integrated AI comprehensively across the value chain from the control room to the board room. Over 200 AI use cases are currently being implemented across ADNOC’s operations, from exploration to refining to logistics and strategic decision making.

“Using AI, we are speeding up our upstream seismic analysis from months to hours. We are increasing the accuracy of production forecasts by up to 90% and we are on course to make ADNOC the most AI enabled energy company in the world.”

Oil Review Middle East hosted a very well-attended webinar on 20 November on the future of offshore operations, in association with SAFEEN Group, part of AD Ports Group

The webinar explored the latest trends and challenges in the rapidly evolving world of offshore operations, focusing on groundbreaking innovations that are driving sustainable and efficient practices. In particular, it highlighted SAFEEN Green – a revolutionary unmanned surface vessel (USV), setting new benchmarks for sustainable and efficient maritime operations.

Erik Tonne, MD and head of Market Analysis at Clarksons, gave an overview of the offshore market, highlighting that current oil price levels are supportive for offshore developments, and global offshore capex is increasing strongly. The Middle East region will see significant capex increase over the coming years, with the need for rigs and vessels likely to remain high. Offshore wind is also seeing increased spending. Global rig activity is growing, while the subsea EPC backlog has never been higher, with regional EPC contracts seeing very high activity. Tonne forecast that demand for subsea vessels and other support vessels will continue to increase.

Tareq Abdulla Al Marzooqi, CEO SAFEEN Subsea, AD Ports Group, introduced SAFEEN Subsea, a joint venture with NMDC, which offers reliable and innovative survey, subsea and offshore solutions to support major offshore and EPC projects across the region. He highlighted the company’s commitment to sustainability, internationalisation and local content, and how it is a hub for innovations and new ideas, taking conceptual designs and converting them to commercial projects. A key project is SAFEEN Green, which offers an optimised inspection and survey solution.

Tareq Al Marzooqi and Ronald J Kraft, CTO, Sovereign Global Solutions ME and RC Dock Engineering BV. outlined the benefits and capabilities of SAFEEN Green as compared with commercial vessels, in terms of safety, efficiency, profitability and sustainability. It is 30-40% more efficient through the use of advanced technologies, provides a safer working environment given it is operated 24/7 remotely from a control centre, and offers swappable payload capacity. Vessels are containerised and can be transported easily to other regions. In terms of fuel consumption, the vessel is environment-friendly and highly competitive, reducing emissions by 90% compared with conventional vessels, with the ability to operate on 100% biofuel.

As for future plans, SAFEEN Green 2.0 is under development, which will be capable of carrying two inspection work-class ROVs simultaneously. A priority will be to collect data to create functional AI models for vessels and operations, with the first agent-controlled payload systems in prospect by around 2027.

To view the webinar, go to https://alaincharles.zoom.us/rec/share/mNHjZhAhQzn1sPzmFWZCgrq7_SckfLRcSb4w81I7aVlokO9sgHM_zVeOqgN3DgJS.bO4OIRqNeFP09SPu?startTime=1732095689000

Giving a keynote address on 25 February at International Energy Week in London, hosted by the Energy Institute, Dr Fatih Birol, executive director of the International Energy Agency (IEA) highlighted the soaring growth in electricity demand and its implications

“We are entering an important new chapter in the history of energy, where electricity is going to be even more important,” he said. “When we look at the numbers, we see the age of electricity is coming.”

Dr Birol pointed out that in the last 10 years global energy demand has increased – but global electricity demand has increased two and a half times higher. In the next 10 years, global electricity demand will increase six times more than global energy demand.

The biggest driver of this demand growth is the increase in air conditioning, set to increase further as incomes and temperatures rise. Growth is also coming from manufacturing, with processes becoming more electrified, and electric vehicles, with one in five cars globally being electric in 2024 compared with one in 25 five years ago. AI and data centres are also a major source of demand, with one medium-sized data centre consuming as much electricity as 100,000 homes.

“This is why we see the age of electricity coming – and it has many implications,” he said.

Constraints to growth

Addressing the constraints, Dr Birol said grids are a major bottleneck, with permitting and licensing processing being an issue. “Last year we saw 7 GB of renewables added to the global power system, the biggest in history, but 1,600 GW in renewables waiting in the queue to be connected. This is economically a criminal story.”

He also noted the bottleneck in terms of manufacturing capacity of electrical components. “If you want to buy a cable, especially a DC cable, you have to wait four years, for transformers, five years,” he noted.  

A second issue is electricity pricing, “very important for the competitiveness of any economy. It’s crucial that governments have the right pricing system. Having the right taxes and subsidies is extremely important. In Europe, electricity prices today are two times higher than before the energy crisis. We need the right diagnosis and the right cure so that economies and citizens are not hit by high electricity prices, a key indicator of whether a country can be economically competitive in the future.”

Another issue is the skyrocketing demand for copper, with a major supply deficit predicted by 2035. “The availability and affordability of copper can be a serious issue in the age of electricity.”

Fourthly, nuclear power is making a strong comeback around the world, driven by energy security concerns. “By 2025 we expect global nuclear electricity generation to be the highest in history,” Dr Birol said, noting that 70 GB of nuclear power plants are under construction, the highest amount in the last three decades, with more than 40 countries having firm plans to expand their nuclear capacity. “By around 2030 we may see commercial SMRs hitting the market,” he added.

Concluding, Dr Birol said, “We are seeing the global economy is being electrified in a rapid sense, mainly driven by emerging countries, but advanced economies are also part of it, driven by traditional as well as new sectors such as AI and electric vehicles. It will not be easy to address all the challenges that the new age will bring. Countries and companies who read what is happening and develop policies and strategies to make the most out of the age of electricity, will have a significant advantage over others in the race of global economic competition.”