A full year of oil exports by the KRG via the export pipeline and an increase in surface processing capacity at Taq Taq and Tawke facilitated strong production growth in 2015, averaging 85,000 bopd.
Genel has interests in two of the largest producing fields in the Kurdistan Region of Iraq, Taq Taq and Tawke, with access to local and international markets. These fields have a currently estimated gross proven and probable (2P) reserves of 803 million barrels of oil (234 mmbbls net to Genel Energy) and gross proven, probable and possible reserves of 1.2 billion barrels of oil (374 mmbbls net to Genel Energy).
Development programmes helped drive production at Taq Taq and Tawke to record levels, with production up 22% year-on-year to 84,900 bopd. The low-cost nature of this production helps make Genel Energy a very resilient business, with our producing oil assets in the Kurdistan Region of Iraq benefiting from production costs forecast at less than $2/bbl in 2016.
Despite the disappointing revision of our reserves at Taq Taq, Taq Taq and Tawke remain low-cost oil fields by any global benchmark. With 264 million barrels of net 2P reserves, the two comprise a robust oil business well positioned in the current oil price environment, and set to be significantly cash generative going forward.
During 2013, the KRG completed the construction of its export pipeline infrastructure, giving it an independent route to export its oil production to world markets.
In January 2014, the KRG announced that initial quantities of crude oil from the Tawke field had flowed through the pipeline system and arrived into storage at the port of Ceyhan on Turkey’s Mediterranean coast.
During 2015, the KRG continued to upgrade the capacity and integrity of the pipeline system through which oil is exported from the KRI to the port of Ceyhan on the Mediterranean coast. The pipeline consists of a number of sections. The first, from the Taq Taq field to the Khurmala Dome, has capacity of 150,000 bopd. The second section, from Khurmala to the KRI border, has capacity of 700,000 bopd. At the border, both the KRI pipeline and the dedicated export pipelines from the Tawke field, which have capacity in excess of 250,000 bopd, are tied into the 40-inch section of the Iraq-Turkey pipeline. The 40-inch section currently has 700,000 bopd of capacity. Pipelines on both the KRI and Turkey sides of the border have sufficient capacity to facilitate all current or future oil exports from Genel’s fields.