Abu Dhabi: Lukoil, Russia’s largest privately-owned company, is expecting to increase the production at its West Qurna-2 oil project in Iraq to 400,000 barrels per day by the end of this year or beginning of the next year.

Dubai-based Lukoil Overseas, the operator of Lukoil’s international upstream-projects, started production at West Qurna-2 in late March of this year with 120,000 barrels per day.

“The current production at the field exceeds 300,000 barrels per day and we are expecting it to increase to 400,000 barrels per day by the end of this year or beginning of the next year,” said Fedor Krimklin, a spokesperson of Lukoil Overseas.

He said that the company is already experiencing a return on its investment in West Qurna-2.

“In recent months, the company sent several carriers to the Southern Iraqi port of Basra to receive buy-back oil for delivery to its customers in Europe.“

West Qurna-2, one of the largest oilfields in the world is located in Southern Iraq, 65 kilometres from the town of Basra. The field has 13 billion barrels of recoverable oil reserves in two main formations — Mishrif and Yamama.

The project is being implemented in three phases. Mishrif Eearly Oil, Mishrif Full Field Development and Yamama Formation Development. The development and production service contract for the West Qurna-2 field was signed on January 31, 2010.

The stakeholders are the South Oil company of the Ministry of Oil of Iraq and consortium of contractors including Lukoil and Iraqi North Oil Company. Lukoil has invested so far more than $4 billion in the oilfield

Lukoil is also working on Block 10, another oil project located in Di-Kar and Mutannah provinces near Basra with Japan’s Inpex Corporation.

“It is in the stage of exploration. We are doing the seismic activity evaluation to gather data.”

If commercial reserves are confirmed on the block, oil production period will last 20 years with a possible 5-year extension. The drilling is expected to begin in 2016. The minimum investment obligation is $100 million.

Lukoil Overseas shifted its base to Dubai late last year because the city is near to their upstream projects located in the Middle East and Central Asia.

Russia came under sanctions from the European Union and the United States over Ukraine crisis.

The spokesperson said that Lukoil’s international upstream projects are not affected as sanctions are only imposed over activities in Russia.