Iraq in deal with CNOOC, TPAO for Maysan oilfield

Iraq signed a final deal yesterday with China's CNOOC and state-run Turkish Petroleum Corporation (TPAO) to develop the Maysan oilfield complex, the 11th in a series of deals that could vault Iraq into the top ranks of global producers.

Oil Minister Hussain Al Shahristani also said Iraq was considering inviting foreign firms to develop its three Middle Furat oilfields.

The deal for the 2.5-billion-barrel Maysan complex would require billions of dollars in investment, said Shahristani.

Ten other deals have been signed since last year with international oil companies to develop the war-damaged country's vast oil reserves. If all the agreements work out, Iraq, which has the world's third-largest oil reserves, could have crude production capacity of 12 million barrels per day, close to top producer Saudi Arabia, in six to seven years.

The Middle Furat oilfields, estimated to have reserves of 600 million barrels, were offered at auction last December in Iraq's second round of oilfield tenders but no bids were received. "If we find enough companies willing to compete we will invite the companies," said Shahristani. "We are now contacting the companies to see if they are willing to develop the fields," he said. China's Sinochem was originally partnered with CNOOC in an unsuccessful bid for the three Maysan fields in Iraq's first auction of oilfield contracts last year.

But it pulled out when CNOOC decided to reconsider and accept the government's proposed remuneration fee of $2.30 for every additional barrel of oil produced, and TPAO stepped in.

CNOOC and TPAO set a plateau target for the oilfields at 450,000 barrels per day (bpd) after six years. CNOOC said it will hold a 63.75 percent stake in the venture while TPAO holds 11.25 percent.

An Iraqi state oil company will hold a 25 per cent stake.

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