Baghdad revs up for oil booster
Photo by Roozbeh Feiz / http://www.flickr.com/photos/rfeiz
Iraq's Cabinet has given the green light to the Oil Ministry to sign
agreements with international players to help boost the nation's crude
output, a ministry official today.
The two-year deals, known as technical support agreements, are designed to
develop five producing fields to add 500,000 barrels per day to the
country's current output of 2.4 million bpd, an Associated Press report said.
Last December, Shell, ExxonMobil and Chevron submitted technical and
financial proposals for the five oilfields and received counter-proposals
from the Iraqi side.
In January, representatives from the companies and from Iraq met again in
Amman, Jordan, and they will hold the third round of discussions later this
month, the official, who spoke on condition of anonymity, told AP.
The official told AP that BP will submit a proposal for the Rumaila oilfield,
Chevron for West Qurna stage 1, ExxonMobil for Zubair, and Shell for Missan
and Kirkuk.
In Vienna, Iraq's Oil Minister Hussein al-Shahristani said that Iraq intends
to compensate companies with crude oil rather than cash, Dow Jones
Newswires reported.
Speaking to reporters as he arrived for today's Opec meeting, Shahristani said
the Oil Ministry was still working on the compensation details with the
Development Fund of Iraq, controlled by the US and United Nations.
Iraq's average production was 2.4 million bpd in January while exports stood
at an average of 1.92 million bpd. December's exports averaged 1.81 million
bpd.
Iraq has been relying on a Saddam Hussein-era natural resources law until
Parliament approves a new oil law to regulate work and share Iraq's
resources among the country's Shi'ites, Sunni Arabs and Kurds.
More than 70 companies met the ministry's deadline of 18 February to compete
for tenders to help develop Iraq's oil reserves, seen as vital to providing
the funds to rebuild the shattered country.
Iraq has not said what fields it will tender, or on what terms, but the
service and extraction contracts on offer are seen as a stopgap until the
oil law is passed, and will not provide the long-term involvement big oil
companies want.
05 March 2008 14:40 GMT
| last updated:
05 March 2008 14:41 GMT
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