Iraq and its partners Royal Dutch Shell and Malaysia's Petronas have awarded Dubai based Dodsal Group a USD 106 million contract to lay a pipeline at the Majnoon oilfield.

Under the deal, Dodsal Group will build a 79 kilometer long pipeline to carry oil from the super giant Majnoon oilfield to a crude storage depot near Zubair in southern Iraq.

An official said that the existing 28 inch Majnoon pipeline is outdated and cannot cope with the projected increase. He added that "Majnoon's current output is around 63,000 barrels per day, and it's expected to hit 175,000 barrels per day in 2012, which requires building a new pipeline to handle the output increase."

Shell, Europe's largest oil company, and Malaysia's Petronas won a contract in 2009 to develop Majnoon, one of the world's biggest oilfields. The eventual output target for the field is 1.8 million barrels per day.

Iraq has awarded a series of massive oilfield development contracts to majors such as Shell and BP with the ambitious objective of expanding its oil production capacity to 12 million barrels per day by 2017.

But oil minister Mr Abdul Kareem Luaibi said earlier this month that Iraq was considering cutting this goal and could renegotiate deals with global oil companies.

(Sourced from www.arabianbusiness.com)