Updated February 2010...see update post below.
BAGHDAD, Iraq (CNN) -- Iraq has signed its first major oil deal with a foreign company since the fall of Saddam Hussein's regime, a spokesman for the Iraqi Oil Ministry said Saturday.
Iraq's oil fields currently produce around 2.5 million barrels a day.
It was the first time in more than 35 years that Iraq has allowed foreign oil companies to do business inside its borders.
The contract with the China National Petroleum Corporation could be worth up to $3 billion. It would allow the CNPC to develop an oil field in southern Iraq's Wasit province for about 20 years, said Oil Ministry spokesman Assim Jihad.
Iraq's Cabinet must still approve the contract, but Jihad said that would happen soon, and work could start within a few months.
The Chinese company will provide technical advisers, oil workers and equipment to develop the al-Ahdab oil field, providing fuel for the al-Zubaidiya power plant in Wasit, southeast of Baghdad, bordering Iran, Jihad said.
Once development begins, the field is expected to start producing a preliminary amount of 25,000 barrels of oil a day and an estimated constant daily amount of 125,000 barrels after three years, he said.
Iraq currently produces about 2.5 million barrels a day, 2 million of which are exported daily, Jihad said. That is close to its status before the U.S.-led war that toppled Saddam in 2003, but below its levels prior to the Persian Gulf War in 1991.
Iraqi Oil Minister Hussein Shahrastani told CNN in July that he is confident Iraq will be able to double its production in the next five years.
As it did with other international companies, the Saddam regime had a partnership contract with CNPC signed at the end of the 1990s that entitled the company to share profits. The current contract, however, will only be a "service contract" under which CNPC is simply paid for its services, Jihad said.
He said Iraq has provided "security guarantees" for CNPC, as it would for any other foreign company that will work in Iraq's oil fields.
Jihad called it a major and significant move for Iraq.
Iraq sparked a scramble for lucrative oil contracts in June, when Shahrastani opened bidding to 35 international companies for long-term contracts to redevelop six oil fields.
The Oil Ministry continues to negotiate short-term, no-bid contracts with several U.S. and European oil companies, including Exxon Mobil Corp., Royal Dutch Shell, Total SA, Chevron Corp., and BP.
Iraq has among the largest oil reserves in the world with an estimated 115 billion barrels -- tying Iran for the No. 2 status behind Saudi Arabia's 264 billion barrels, according to estimates from the Energy Information Administration.
CNN's Jomana Karadsheh contributed to this report.
Update Post Feb 26, 2010 from Planck's Constant
By Bernie on 24 Feb 2010
Can you imagine anyone during WWII carrying signs asking why we are attacking Germany, a country that never attacked us directly? How about signs with "No Blood for Beer" as if America could not buy or produce any beer on its own, but had to get it from Germany or else?
Most uninformed individuals think that we went to Iraq for oil. Indeed, a common refrain found on blogs is "The war [in Iraq] and the occupation are all about the neocons desire to control Middle East oil."
As I wrote:
Update Post Feb 26, 2010 from Planck's Constant
Why are We in Iraq and Afghanistan
By Bernie on 24 Feb 2010
First of all, this question would not have been posed half a century ago. Back then, we had fewer Liberals and Muslims in America, that is to say, fewer idiots, and so fewer silly questions.
Can you imagine anyone during WWII carrying signs asking why we are attacking Germany, a country that never attacked us directly? How about signs with "No Blood for Beer" as if America could not buy or produce any beer on its own, but had to get it from Germany or else?
Most uninformed individuals think that we went to Iraq for oil. Indeed, a common refrain found on blogs is "The war [in Iraq] and the occupation are all about the neocons desire to control Middle East oil."
As I wrote:
As for neocons desire to control middle east oil, isn't it cheaper just to buy it? Gold is more precious than oil, yet we didn't invade South Africa (which controls most of the world's gold supply) to CONTROL GOLD. When we need it - we buy it.
Starting a war to control oil only drives the price higher. You are rather naive. If the US wanted to control Arab oil, it would have invaded Israel and set up a Palestinian state. With no tensions in the middle east, oil would have dropped to $12 a barrel, about 4 bucks more than the cost of producing it.
That's how you control oil.
As for idiots of the Muslim kind, a commenter to my article Islam is the Fastest Growing Religion - Not gives us his twisted view of why we are in Iraq and Afghanistan: "you want what muslims have... and are murdering for it!"
First of all, Muslims have nothing that we can't buy elsewhere. As for oil, the majority of it is bought from non-Muslim countries: Canada, Colombia, Norway, the United Kingdom, Venezuela, Equatorial Guinea, and many other countries. "The diversity of the US oil supply makes it difficult to cut off the country's supply of oil altogether." [Link]
At present, we produce 40% of all the oil we need. We don't need to spend billions on a war to control oil, because if we want, we can exploit the oil we already have here in the states 1.
So unless Iraq is the only country left with oil, why waste one bullet on a Muslim to get his oil? Isn't it cheaper to simply buy it?
As for being in Afghanistan, certainly the country has no valuable assets other than donkey dung and opium. No person in his right mind would invade Afghanistan for its 'riches.'
Caption (ISAF Photo at top - by U.S. Air Force TSgt Laura K. Smith):
[Click on image(s) for larger view]
For more of my articles like this see Blood for Oil
First of all, Muslims have nothing that we can't buy elsewhere. As for oil, the majority of it is bought from non-Muslim countries: Canada, Colombia, Norway, the United Kingdom, Venezuela, Equatorial Guinea, and many other countries. "The diversity of the US oil supply makes it difficult to cut off the country's supply of oil altogether." [Link]
At present, we produce 40% of all the oil we need. We don't need to spend billions on a war to control oil, because if we want, we can exploit the oil we already have here in the states 1.
So unless Iraq is the only country left with oil, why waste one bullet on a Muslim to get his oil? Isn't it cheaper to simply buy it?
As for being in Afghanistan, certainly the country has no valuable assets other than donkey dung and opium. No person in his right mind would invade Afghanistan for its 'riches.'
Caption (ISAF Photo at top - by U.S. Air Force TSgt Laura K. Smith):
HERAT, Afghanistan--Afghan Border Police (ABP) members provide security during the processing of illegal narcotics which were seized during an ambush on 14 Dec 2008. This was the largest seizure to date by the 4th Brigade of the ABP.
Notes
(1):
NEW TOWN, N.D. (AP) — An oil boom on American Indian land has brought jobs, millions of dollars and hope to long-impoverished tribal members who have struggled for more than a century on the million-acre Fort Berthold Indian Reservation.
In little more than a year, oil companies have put dozens of money-producing rigs on remote rolling prairie and sprawling badlands that are home to small cattle ranches and scattered settlements of modular housing. Although other tribes around the nation have oil interests, industry officials said none has likely experienced a recent windfall of this scale.
...
The reservation was the last area to be targeted by companies in the state's oil patch because of onerous federal requirements. But a 2008 tax agreement standardized the rules for oil drilling.
[Click on image(s) for larger view]
For more of my articles like this see Blood for Oil
Seems I recall, not too long ago, many leftists crying because some American Oil Companies were trying to get drilling rights in Iraq.
ReplyDeleteAny bets these same leftists will remain silent now?
My daddy told me to never take another man's bet...
ReplyDelete