Russia starts oil production in southern Iraq

Russian oil company Lukoil started its first pumping of crude oil from Iraq's giant West Qurna-2 oil field on Saturday, as Iraq is working to boost its oil exports to a higher level. The field's daily production started with 120,000 barrels and is expected to increase to 400,000 barrels by 2014, Iraq's Minister of Oil Abdul Kareem Luaybi said at the inauguration ceremony in the southern oil-hub city of Basra, some 550 km south of the Iraqi capital Baghdad. Earlier, Iraq said its daily oil production in February reached 3.5 million barrels, the highest export average since 1990 when its former leader Saddam Hussein invaded neighboring Kuwait. The invasion incurred severe UN sanctions that crippled Iraq's oil industry. Luaybi hoped that his country's oil output could possibly reach four million barrels per day by 2014. "This is a historic and great accomplishment that would enable the government to implement its development programs by increasing its revenues." West Qurna-2 oil field is the second largest undeveloped field in Iraq after Rumaila oil field, and also one of the world's super giant oilfields with an estimated recoverable reserve of about 14 billion barrels. The Iraqi economy depends on oil revenues for nearly 95 percent of its budget. In 2010 Iraq announced that its proven oil reserves increased to 143.1 billion barrels from the previous estimation of 115 billion barrels.