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< Back to Iraqi Dinar in the News April 14th, 2008

Iraqi Oil Ministry Initiates First Oil and Gas Bidding Round under New Regime

11:16 04/14 (CEP News) London – The Oil Ministry of Iraq has opened talks on potential deals with major oil companies aimed at furthering the country’s oil and gas exploration and improving supply infrastructure, according to a communiqué issued on Monday.

In the communiqué, the ministry has published a list of 35 companies that it said were qualified to bid in the first licensing round for new oil and gas contracts. The list includes oil giants BP, Royal Dutch Shell, ExxonMobil, Chevron and Total.

Other prominent firms on the list include Russia's Lukoil, China’s CNOOC, Brazil's Petrobras and Norway's Statoil. All bidders, which were shortlisted from a preliminary list of nearly 120 companies, would be seeking new exclusive contracts to extract and pump oil.

Companies operating in the autonomous Kurdish region of Northern Iraq were not allowed to participate in the auction, while those that failed to qualify for the first round could yet be added to the list for later bidding rounds, the oil ministry said.

Iraqi oil output is presently at a 48 month high of 2.3 million barrels per day and was included by OPEC in its production output figures published on March 1st at the cartel’s 148th General Meeting in Vienna.

Iraq’s infrastructure has been hit by years of war, violence and sanctions. While attacks on the country’s oil infrastructure still take place, the industry analysts see the situation improving following the current surge operation initiated by the U.S. armed forces under General David Petraeus.

However, attempts to create a legally acceptable framework for how the country's oil wealth should be distributed among its different ethnic groups have encountered problems.

By Gaurav Sharma, gsharma@economicnews.ca, edited by Cristina Markham, cmarkham@economicnews.ca

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