ESTIMATES BY COUNTRY
Saudi Arabian crude is the cheapest in the world to extractbecause of its location near the surface of the desert and thesize of the fields, which allow economies of scale.
The operating cost (stripping out capital expenditure) ofextracting a barrel in Saudi Arabia has been estimated to bearound $1-$2, and the total cost (including capital expenditure)$4-$6 a barrel.
Extraction of Iraqi oil is in theory also very cheap,although there are political and security challenges.
Industry analysts estimated total costs at between $4-6,although they said some fields could be more expensive.
In the United Arab Emirates, operating and capital costscombined were estimated to be around $7 a barrel.
Oil extraction from mature and deep water offshore fields ismuch more expensive than from the accessible hydrocarbonterritory of the Gulf.
In Nigeria, production in ultra-deep water fields can reach$30 a barrel compared with onshore costs of around $15,according to analysts.
In offshore Angola, it costs around $40 to produce onebarrel of oil (operating and capital costs), traders toldReuters.Operating and capital costs in Algeria, Iran, Libya, Omanand Qatar were all estimated to be around $10-15 a barrel.
In Kazakhstan, where reserves are big and largelyunexploited, the cost to produce a barrel for medium-sizedproducers, such as Kazakh state oil company KazMunaiGas [KMG.UL]is around $15-18, and for Kazakhstan's largest operatorTengizchevroil, it is about $10-12, the Kazakh-British Chamberof Commerce said.
Analysts said these were operating costs, probably includingtransport, as it is expensive to move the oil to distant ports.
In Venezuela, where fields tend to be mature and small andit is difficult to make new discoveries, production costs weregenerally estimated at $20 a barrel (operating and capitalcosts).
Those figures do not include the more expensive Orinoco oilfrom the country's sand deposits.
One analyst said the extraction of one barrel of Orinoco wasaround $30 (operating and capital costs).
Ecuador, where fields are also small and the distance toports add to costs, analysts pegged extraction costs at $20 abarrel.
In the mature British North Sea, where the remaining oil isdifficult to access, the industry body Oil & Gas UK said thebreak-even cost was around $50 a barrel. One analyst saidoperating and capital costs were $30-40 a barrel.The International Energy Agency (IEA) -- in its latestNovember 2008 world energy outlook -- gave the followingestimates for the all-in costs of producing oil from varioustypes of hydrocarbons in different parts of the world:
Oilfields Estimated Production /source Costs ($ 2008) Mideast/N.Africa oilfields 6 - 28 Other conventional oilfields 6 - 39 CO2 enhanced oil recovery 30 - 80 Deep/ultra-deep-water oilfields 32 - 65 Enhanced oil recovery 32 - 82 Arctic oilfields 32 - 100 Heavy oil/bitumen 32 - 68 Oil shales 52 - 113 Gas to liquids 38 - 113 Coal to liquids 60 - 113 Source: International Energy Agency World Energy Outlook 2008 (Compiled by Martina Fuchs, Christopher Johnson, Karen Norton,Joe Brock and Barbara Lewis, Editing by James Jukwey)
FACTBOX-Oil production cost estimates by country | Reuters
