(Yicai) Feb. 5 -- China Oil HBP Science and Technology, a provider of integrated solutions for oil and gas resource development and utilization, has signed a USD225 million contract for the resumption of production services at the Naft Khana oilfield in Iraq.

China Oil HBP will provide engineering, procurement, construction, operation, and maintenance services for the resumption of production at the Naft Khana oilfield, the Beijing-based company announced yesterday, citing a deal it inked with the project operator NK Petroleum.

The services include inspection, evaluation, and repair of the existing facilities at the oilfield, upgrading the central processing facility and field surface facilities, and building a new gas processing unit and an auxiliary power plant, China Oil HBP noted.

The temporary acceptance of the project is expected to be completed within 18 months, followed by a three-year operations and maintenance service period after the resumption of production at the oil field, the firm added.

The value of the contract equals 61 percent of China Oil HBP’s audited operating revenue in 2024, so the signing will likely positively impact the company’s operating performance, as well as strengthen its market position in the Middle East and enhance its market share and competitiveness, according to China Oil HBP.

The Naft Khana oilfield is one of the earliest oilfields discovered in Iraq, with a peak daily production of up to 25,000 barrels. Due to war damage, unstable security conditions, and prolonged underinvestment, the oilfield has been operating at low production levels since 2003, with full suspension of operations after 2023.

The goal of the restoration project is to bring the Naft Khana oilfield’s daily production back to 15,000 barrels.

HBP’s shares [SHE: 002554] were trading up 2 percent at CNY3.95 (56 US cents) as of 1.50 p.m. today, after earlier surging as much as 8.9 percent. The Shenzhen Component Index fell 1.3 percent.

Registered in Hong Kong, NK Petroleum is a wholly-owned subsidiary of Shanghai-listed Geo-Jade Petroleum. It is mainly engaged in the investment, construction, and operation of upstream and downstream projects in the oil and gas sector.

Shares of Geo-Jade Petroleum [SHA: 600579] were trading down 1.1 percent at CNY9.07 (USD1.30) as of 1.50 p.m. today.

Editors: Tang Shihua, Futura Costaglione