Iraq to strike deals at oil auction

Iraq will on Saturday look to attract further foreign energy investment as it continues an auction of its oil fields, a day after striking deals with consortiums led by energy giants Shell and CNPC.

The two-day awarding of contracts comes as Baghdad seeks to dramatically boost its crude output and become one of the world’s biggest oil producers, bringing in much-needed revenues to rebuild the war-battered country.Investors will likely focus on the supergiant West Qurna-2 field, one of the world’s biggest undeveloped oil fields, which is by far the biggest being offered on Saturday with known reserves of 12.9 billion barrels of oil.

The field lies in southern Iraq, to the west of the equally large Majnoon reservoir, which was auctioned on Friday.The contract for Majnoon was jointly won by Anglo-Dutch firm Shell and its Malaysian partner Petronas, while China’s CNPC led a group comprised of Petronas and France’s Total to capture Halfaya, also in southern Iraq.

Shell and Petronas will receive fees of 1.39 dollars per barrel of oil they extract from Majnoon, which has proven reserves of 12.6 billion barrels of oil, and project that they will produce 1.8 million barrels per day (bpd).The pair beat out a rival offer for Majnoon from Total and CNPC. - AFP