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

    Senegal's village of women

    Senegal's village of women

    Women in northeast Senegal are using solar-powered irrigation to farm food and halt the encroaching desert.

    Inside Baltimore's human trafficking industry

    Inside Baltimore's human trafficking industry

    Survivors of sex trafficking and those who investigate it in the city share their stories.

    Nuclear Gulf: Is Saudi Arabia pushing itself into a nuclear trap?

    Nuclear Gulf: Is Saudi Arabia pushing itself into a nuclear trap?

    MBS is prepared to pursue nuclear weapons if Iran gets them. But could he end up making the kingdom a nuclear pawn?