BAGHDAD — More than three decades after they were booted from the country by Saddam Hussein, international oil companies are poised for a return to Iraq, where next week they will bid for a slice of the country’s vast crude reserves.
Iraq needs the expertise of internationals that can develop its dilapidated oil and gas industry. The country lacks the oil revenues needed for reconstruction after a U.S.-led war.
Yet a constitutional fight pitting Oil Minister Hussain al-Shahristani against the parliament and the semiautonomous Kurdish government threatens to undercut the bidding process.
Discord over the two days of bidding scheduled to begin Monday lies in a struggle between Iraq’s various religious and ethnic factions over control of one of the world’s largest proved reserves of oil — an estimated 115 billion barrels. And the debate in Baghdad is tinged with a troubled past that includes some of same international companies now back at the table.
Exxon Mobil, Royal Dutch Shell, Repsol, the China National Petroleum & Chemical Corp. and Russia’s Lukoil and other approved companies, have been asked to put up a total of $2.6 billion for what the ministry calls "soft loans.”
In return, they will have the right to develop Iraq’s main oil fields, which could net the companies a total of $16 billion. The companies also must shoulder the costs of creating a national oil and gas joint-venture.
In return, Iraq has offered limited access, through the service contracts, to its oil fields that hold 43 billion barrels of reserves. But the contracts provide little in the way of security, physically or contractually, to big oil companies.
by the associated press
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