Iraqi VP to Discuss Total Oil Field Deal in Paris

PARIS (Dow Jones Newswires), Apr. 14, 2009

Iraqi Vice President Adel Abdel Mahdi said Tuesday he will meet executives from the French energy giant Total SA (TOT) to discuss a multi-billion dollar oil deal during a working visit to France.

Briefing journalists in Paris on the first day of a three-day visit, Abdel Mahdi and senior Iraqi officials said they hoped to attract French investment in the key oil production sector, devastated by war and neglect.

"Total has shown a keen interest to work in Iraq, particularly in upstream development of oil and gas fields," said senior Iraqi government adviser and former oil minister Thamer al-Ghadhban, sitting alongside Abdel Mahdi.

Contacted by AFP, Total preferred not to comment on its plans.

Ghadhban confirmed that Total, France's largest and most profitable firm, had forged a partnership with U.S. giant Chevron Corp. (CVX), which has been asked to bid for a contract to exploit one of southern Iraq's most promising fields.

"Total, partnered with Chevron, has been asked to bid directly on the Nahr Bin Umar oil field on a different arrangement from the first stage round which has been staged last year by the ministry of oil," he said.

Although the Nahr Bin Umar field auction is to be held separately from the main auction process for Iraqi fields, the Franco-U.S. consortium will still face rival bids, including from Norway's StatoilHydro, he said.

The field was one of two fields that Total was already negotiating to take over under the former regime of ousted Iraqi dictator Saddam Hussein, he said.

"So Total is in a really advantageous position," he said.

Abdel Mahdi, an opponent of the former regime who speaks fluent French and English after spending 25 years in exile in France, added: "I've talked to them many times, and they're definitely interested."

The officials said the amount of money that Total's consortium would need to invest to develop the fields wasn't yet decided, but that a figure in the region of $15 billion or EUR15 billion had been discussed.

Iraq's ambassador in Paris, Mowaffak Abboud, said the two fields in which Total was most interested had the potential to produce more than one million barrels of crude a day between them over a 14-year period.  

Copyright (c) 2009 Dow Jones & Company, Inc.