Iraq signs key oil deal | News | Al Jazeera

Iraq signs key oil deal

Iraq agrees terms with British and Chinese companies to develop Rumaila oilfield.

    Iraq's oil minister said a second round of bidding for Iraqi oil contracts is due in December [AFP]

    Production boost

    The venture, expected to cost between $14 and 20bn, is expected to boost production at the southern Rumaila field from the current one million barrels a day (bpd) to around 2.8 million bpd over its 20-year duration.

    In depth


     Focus: The scramble for Iraq's 'sweet oil'
     Iraqi oil for sale
     Inside Iraq

    Rumaila is already vital to Iraq's output, contributing almost half the nation's oil production of about 2.5m bpd.

    BP and CNPC were the only companies to win a bid when Iraq offered eight contracts in a June auction. The companies agreed to receive only two dollars a barrel to operate Rumaila, which has known reserves of 17.7 billion barrels.

    It is the first big upstream deal between Iraq and foreign oil companies since nationalisation of the country's industry about 40 years ago.

    Oil contracts

    Under the contract, Iraq's State Oil Marketing Organisation will be allocated Baghdad's 25 per cent stake, while BP will take 38 per cent and CNPC hold the remaining 37 per cent.

    The plan to increase production envisages a 10 per cent increase within a year and raising the field's output by 300,000-400,000 bpd within three to four years, the Middle East Economic Survey (MEES) reported last week.

    The second round of bidding for Iraqi oil contracts is due in the first half of December, Hussein al-Shahristani, Iraq's oil minister, said last month.

    SOURCE: Agencies


    YOU MIGHT ALSO LIKE

    Interactive: Coding like a girl

    Interactive: Coding like a girl

    What obstacles do young women in technology have to overcome to achieve their dreams? Play this retro game to find out.

    America's Guns: Secret Pipeline to Syria

    America's Guns: Secret Pipeline to Syria

    How has the international arms trade exacerbated conflict in the Middle East? People and Power investigates.

    I remember the day … I designed the Nigerian flag

    I remember the day … I designed the Nigerian flag

    In 1959, a year before Nigeria's independence, a 23-year-old student helped colour the country's identity.