Iraq Lays Out Plans for First Oil-Bid Round

Iraqi Oil Fields
(Click to Enlarge)

LONDON (Dow Jones Newswires), October 13, 2008

Iraqi Oil Minister Hussain al-Shahristani laid out details Monday of the country's first- ever oil licensing round, and said the national government will have firm control over several oil fields that will be jointly developed with foreign companies.

Shahristani said Iraqi state-run entities will have 51% control in projects to rehabilitate six oil fields already producing crude and two natural gas fields yet to be developed. Foreign companies will have 49% in projects and operate under fee-based service contracts.

Shahristani, in London to address companies on details of the licensing round, made clear that Iraq wants to move fast with the licensing round after endless delays getting its oil sector back on its feet since the end of the U.S.-led invasion in 2003.

Foreign companies are expected to submit bids within six months and the government wants deals in place by June. Only the Iraqi cabinet, not the Iraqi parliament, will get to approve whatever deals end up being signed, he said.

"We can't afford any more delays," Shahristani told journalists after meeting officials from 35 oil companies earlier in the day.

Copyright (c) 2008 Dow Jones & Company, Inc.


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