(Yicai Global) July 19 -- Shares of Zhongman Petroleum and Natural Gas Group climbed after the Chinese oilfield services provider said it had signed a USD390 million contract to provide drilling engineering services to Iraq’s Basra Energy.

ZPEC’s stock [SHA: 603619] closed 4.9 percent up at CNY20.41 (USD2.83) in Shanghai today, after earlier gaining by as much as 6.4 percent.

ZPEC and Basra Energy inked the deal on July 16, the Shanghai-based firm announced yesterday. The value of the contract equals more than 91 percent of ZPEC’s audited operating revenue last year and 217 percent of its drilling engineering business’ operating revenue in 2022, it added.

The 4.5-year deal will further ZPEC’s partnership with Basra Energy, consolidate its advantages in Iraq, and improve its business performance between next year and 2028, the firm added.

Payment will be in US dollars, so fluctuations in the international financial market and dollar will impact the actual income from the deal, ZPEC noted.

Iraq’s oil ministry formed Basra Energy as the main contractor at the Rumaila oilfield, Iraq Business News reported in November 2021. Basra Oil, Iraq’s State Organization for Marketing of Oil, PetroChina, and BP are its shareholders, Iraqi Oil Minister Abdul Jabbar said at the ceremony to set up the firm.

Editor: Futura Costaglione