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Oil fields open, but foreign firms shy
(China Daily)
Updated: 2009-07-01 07:53
BAGHDAD: Iraq's long-awaited licensing round to develop some of its massive oil reserves stumbled yesterday as oil and gas companies dug in their heals, demanding more money for their efforts than the government was willing to pay. International oil companies were submitting bids for six oil and two gas fields more than 30 years after Saddam Hussein nationalized the oil sector. By midday, only one field had been awarded and several others drew limited to no interest. The government was hoping that the licensing round would result in companies flooding in as the country looks to boost output of a resource whose sales bring in 90 percent of the government's revenues. Two consortiums submitted offers for the Rumaila oil field, which holds 17.8 billion barrels in crude reserves. British giant BP PLC and China's CNPC made up the first consortium, while US giant Exxon Mobil and Malaysia's Petronas comprised the second. Under the service contracts, the companies would be paid a per barrel fee for any crude they produce in excess of a minimum production target. The Exxon Mobil-led consortium requested $4.8 per barrel for production over the minimum and BP wanted $3.99 per barrel, Oil Minister Hussain al-Shahristani said. The ministry was willing to pay $2 per barrel. BP agreed to match the ministry's price and won the contract for Rumaila, said al-Shahristani. No bids were offered on the second field on offer, Mansouria while no agreement was reached on the remaining Zubair, Bai Hassan, Missan and the Kirkuk fields. AP
(China Daily 07/01/2009 page11) |
