Iraq holds the world’s third-largest oil reserves and needs billions of dollars of investment to overhaul infrastructure and boost oil and gas output after years of sanctions and war. A vital oil law to establish the framework for foreign investment has been stalled for a year by political feuding. As stop-gap measures to boost output until the law is in place, Iraq plans to issue oil extraction and service contracts. “Up to now, 35 companies have been qualified out of 120 companies that presented their documentation to the oil ministry,” government spokesman Ali al-Dabbagh said at a press conference.
The process was ongoing, and some companies that had failed to submit all the documentation necessary would be given the chance to complete their paperwork, he added. Dabbagh did not give details on qualified companies, nor say if any had been disqualified. Baghdad has said that companies that had done deals with the semi-autonomous Kurdish region in northern Iraq would not be allowed to bid for contracts in the rest of the country. Baghdad claims the Kurdish deals are illegal. Iraq would publish the list of qualified companies “in coming days”, he said. Iraq asked oil companies interested in the service contracts to submit their paperwork to Baghdad by mid-February. It had initially planned to issue the list of qualified companies in March before announcing the fields and contracts that would be open to bidding in April.
FRACTION
Iraq produces about 2.3 million barrels per day of oil, a tiny fraction of its 115 billion barrels of proven crude reserves.
RELATIONS
Iraq’s prime minister will travel to Brussels later this week for his first official visit to discuss relations with the European Union, especially in the energy field, a government spokesman said Sunday. Prime Minister Nouri al-Maliki will lead a delegation to the Belgian capital on Wednesday for a two-day visit aimed at enhancing political, security, military and economic relations, spokesman Ali al-Dabbagh said. The Iraqi leader will meet with the EU’s foreign affairs chief Javier Solana, Nato Secretary-General Jaap de Hoop Scheffer and other top officials. The meetings “will also be about an Iraqi-European understanding in the field of energy, especially in the gas field,” al-Dabbagh said at a joint news conference with US military spokesman Rear Adm. Patrick Driscoll. “Iraq has huge reserves of (natural) gas and European countries are in dire need of it,” al-Dabbagh added. Early this year, the Iraqi Oil Ministry said it was negotiating with Royal Dutch Shell PLC to conduct output tests on Akkas gas field, a prized natural gas field in western Iraq.
BAGHDAD: Iraq has fully restored 100,000 barrels per day (bpd) of oil output from three fields that were shut down after a bomb attack on a pipeline in late March, Iraqi oil officials said on Sunday. The attack on a pipeline on March 27 was the first to affect southern oil exports since 2004. The attack shut the Bazargan, Majoon and Bin Umar oilfields, which had been pumping around 100,000 bpd. The Bin Umar field restarted about a week ago, one official said. The Majnoon and Bazargan fields had resumed pumping earlier. “Everything is flowing fine now,” another official said. Iraqi engineers connected a pipeline by-pass to allow output from the fields to restart despite extensive damage to a branch of the line from Bazargan. Iraq used oil storage at both the fields and its main southern oil Basra terminal to minimise the impact on shipments. Iraq’s southern oil exports flowed at around 1.68 million bpd on Sunday, up from around 1.44 million bpd on Saturday, a shipping source said.
DUBAI: Iraq has cut the May official selling price for its Basra Light crude to buyers in Asia, Europe and the United States, an Iraqi oil official said on Sunday. Prices to buyers in the United States were cut the most, down $1.75 on the month to a discount of $8.80 a barrel to the second-month futures contract for US crude benchmark WTI. Refiners in Europe saw the price fall $1 to a discount of $7.25 to North Sea spot crude marker BFOE. Iraq cut the price of Basra Light crude to Asian buyers by 50 cents to a discount of $2.90 to the average of Oman/Dubai quotes, the official said. The cuts reflected a widening spread on spot markets between light and medium crudes, the official said. “This is the market reality,” he said. “These are substantial reductions, that reflects the price differences between the grades.” For its Kirkuk crude sold from the Turkish Mediterranean terminal of Ceyhan in May, Iraq cut prices to both US and European buyers. US buyers saw the price fall $1.65 on the month to a discount of $7.30 to first-month WTI. To European lifters, Iraq cut the price $1.20 to BFOE minus $5.90. (Arab Times Onlines)
The following is the full list of companies Iraq’s oil ministry has declared qualified to bid:
Anadarko Iraq Marathon International
BG International Mitsibushi Corp
BHP Billiton Nexen
BP Nippon Oil
Chevron Iraq Occidental Petroleum
CNOOC China ONGC
CNPC Petronas
Conoco Phillips Pertamina
Edison International Premier
Eni Repsol
Exxon Mobil Shell Iraq
Hess Corporation Sinochem
Inpex Holding Sinopec
Japex Statoil Hydro
JSC Gazprom Neft Total
Kogas Wintershall BASF Group
LUKoil Woodside
(Reuters)
