French oil giant TotalEnergies has initiated the second phase of development at Iraq’s Ratawi oilfield and has begun constructing a seawater treatment plant, as announced on Monday. This marks the final stages of a $27 billion multi-energy project aimed at enhancing Iraq’s oil, gas, and power production, reducing reliance on imports from neighboring Iran, and attracting foreign investors back to the country.
Iraq’s Prime Minister, Qatar’s Energy Minister, and TotalEnergies’ CEO convened in Baghdad to finalize contracts for the joint Gas Growth Integrated Project, which is led by Total (45%), Iraq’s state-owned Basra Oil Company (30%), and QatarEnergy (25%).
Iraq’s oil production has stagnated in recent years as ExxonMobil, Shell, and BP have scaled back operations due to unsatisfactory returns under fixed-fee technical service contracts. The Total deal aims to reverse this trend by offering improved terms, including a new revenue-sharing model and a reduced government stake in the project.
The first redevelopment phase of the Ratawi oilfield, initiated by Total in late 2023, is expected to boost production to 120,000 barrels per day by early next year. The newly launched second phase aims to nearly double production by 2028 and eliminate routine gas flaring, according to Total’s statement.
Turkey’s ENKA construction company will build the oil and gas processing facility, which will have a daily production capacity of 210,000 barrels of oil and 163 million standard cubic feet of gas, as reported by the Iraqi Prime Minister’s office. Additionally, a seawater treatment plant with a capacity of 5 million barrels per day will be constructed by South Korea’s Hyundai Engineering and Construction, allowing drought-stricken Iraq to utilize seawater for oil production instead of freshwater from rivers and marshes.
Total has also signed an agreement with China’s Petroleum Engineering & Construction Corp to establish a gas processing plant in southern Iraq with a total capacity of 600 million standard cubic feet per day, according to the Prime Minister’s office.
The broader project includes a 1-gigawatt solar park and additional facilities to capture associated gas from oilfields for electricity generation, which will help reduce Iraq’s dependence on Iranian gas and power, which currently accounts for 30% to 40% of Iraq’s needs.
In remarks on Sunday, Prime Minister Mohammed Shia al-Sudani expressed optimism about the increase in foreign investment, a goal that Iraq has struggled to achieve since the initial rush of deals following the U.S. invasion over a decade ago.
Iraq’s oil production capacity has remained around 5 million barrels per day in recent years, despite aspirations to rival Saudi Arabia’s output of 12 million barrels per day, which represents over 10% of global demand, following competitive bidding rounds for oilfield development launched in 2009 to attract international oil companies.
Source: TotalEnergies
