THE WALL STREET JOURNAL
JANUARY 25, 2010
By Hassan Hafidh
Of DOW JONES NEWSWIRES
A consortium made up of Exxon Mobil Corp. (XOM) and Royal Dutch Shell PLC (RDSA) finalized a deal in Baghdad Monday to develop the West Qurna phase 1 oil field in southern Iraq, Iraqi oil officials said.
It represents the first time a U.S.-led group has been allowed into Iraq’s oil patch since the U.S.-led invasion in 2003.
Exxon and Shell won the right to develop the field following the country’s first postwar licensing auction held last year. The license to develop the field wasn’t initially awarded in the auction in June, but a deal was reached following subsequent negotiations.
Under the terms of the 20-year-long deal, Exxon and Shell will be paid $1.90 for each extra barrel of oil they extract on top of current production at the field.
The Exxon team said it would boost production at the field to 2.325 million barrels a day, up from just 279,000 barrels a day currently. The field has estimated reserves of 8.7 billion barrels.
-By Hassan Hafidh, Dow Jones Newswires; +962 799 831 831; firstname.lastname@example.org