Dana Gas said has that the 20-year Gas Sales Agreement, GSA it signed with Kurdistan Regional Government in relation to the second phase of expansion in the Kurdistan Region of Iraq, KRI, aims to increase Pearl Petroleum’s (in which Dana Gas holds a 35 per cent stake) gas and condensate production by 63 per cent from 400 million standard cubic feet per day (mmscf/d) and 15,000 barrels per day (bpd) to 650 mmscf/d and 25,000 bpd respectively.

“The financial impact of this expansion is directly related to the oil price. With oil price ranging between US$60-$70 per barrel we expect the new phase of expansion to add $175-$200 million (Dh641-733 million) to Dana Gas share of revenues and project’s cash flows per annum. The dividends from Pearl to Dana Gas will be dependent on the investment programme and operating cost at Pearl,” said Dana Gas in a disclosure letter to the Abu Dhabi Securities Exchange.

“The financial impact of this transaction will come into effect when the construction of the new capacity is completed in 2021 and the incremental production starts to flow,” the letter added.

The company and its partners are also planning to further expand production by an additional 250 mmscf/d in 2022 which is expected to have a similar financial impact and will take production of gas and condensate up to 900 mmscf/d and 35,000 bpd respectively.