​Consortium formed by two Chinese firms to build crude oil processing facility in southern Iraq

Photo taken on Nov. 29, 2021 shows a fruit stall at the al-Midan market in Mosul, Iraq.(Xinhua/Khalil Dawood)

China CAMC Engineering Co., Ltd. (CAMCE, 002051. SZ) announced on January 23 that the consortium formed jointly by CAMCE and CNOOC Petrochemical Engineering Co., Ltd. had signed a contract with Kuwait Energy Basra Limited on building a central crude oil processing facility project in Iraq, reported stcn.com.

According to the announcement, Kuwait Energy Basra Limitedis a wholly-owned subsidiary of United Energy Group Limited (00467.HK), a large upstream oil and gas company. In accordance with the contracts on exploration, development and production services signed between Kuwait Energy Basra Limitedand Iraq's state-run oil giant Basra Oil Company, Kuwait Energy Basra Limitedisthe operator of exploration, development and production services in related district of Basrain southern Iraq.

CAMCE focuses on five core business, namely engineering contracting, design and consulting, equipment manufacturing and research and development, investment operation, and trade logistics.

The commercial contract value of the project is 594 million U.S. dollars. It is located in the north part of Basra, and aims to build a central crude oil processing facility that has a daily output of 100,000 barrels and provide design, procurement, construction and debugging services for crude oil processing system and auxiliary system.

As the leading partner of the consortium, CAMCE takes up 93 percent of the consortium and is in charge of project management, equipment and material supply, construction debugging and overall delivery. CNOOC Petrochemical Engineering Co., Ltd. takes up the rest 7 percent of the consortium and is responsible for design and related technical support.

CAMCE said that the contract value of the project is about 3.768 billion yuan, accounting for 47.31 percent of the company's total operating revenue of 7.966 billion yuan in 2020.

According to the company, the fulfillment of this contract will exert a positive impact on the company's performance in the next three years, helping consolidate and enhance the company's professional advantages in the petrochemical field and expanding its market share in the Belt and Road countries.