British energy company Gulf Keystone Petroleum said it started operations for the Shaikan-7 exploration well in the semiautonomous Kurdish region of Iraq. The company said Shaikan-7 is its first deep exploration well, targeting natural reserves more than 2.5 miles underground.
Drilling is expected to take nine months.
"With Shaikan-7, we hope to confirm our expectations of major reservoirs beneath the deepest horizon drilled to date and add to what is already recognized as one of the world's largest onshore conventional oil and gas developments," Chief Executive Officer John Gerstenlauer said in a statement.
The company said the Shaikan oil discovery could hold as much as 10.5 billion barrels of oil. It expects to reach a full-scale production level of 150,000 barrels per day by 2015.
The central and Kurdish governments in Iraq are at odds over legal issues related to oil. As a whole, the International Energy Agency said Iraq could be producing 6.1 million bpd by 2020.
2014: The Year in Music [PHOTOS]