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International Herald Tribune: Iraq’s oil ministry invites companies to bid on seismic surveys for two key fields

The Associated Press
Published: March 22, 2008

BAGHDAD: Iraq’s Oil Ministry has invited local and international oil companies to bid for contracts providing technical support for two major oil fields in southern and northern Iraq.

Companies interested in providing 3D seismic surveys for the Kirkuk field in the north and Rumaila oil field in the south must meet the ministry’s deadline of April 30, said the ministry’s Oil Exploration Company in two tenders issued on the ministry Web Site.

The two fields are among Iraq’s 10 “super giant” fields.

The Kirkuk field is located around the city of Kirkuk, 290 kilometers (180 miles) north of Baghdad, while Rumaila is near Iraq’s second-largest city of Basra, 550 kilometers (340 miles) southeast of the capital.

A meeting will be held next June for negotiations with the interested companies and field operations are planned to start in the last quarter of 2008.

A 3D seismic survey is one with seismic lines set out in close grid pattern to gain better resolution of geological formations in an area — giving better clues to the presence of oil.

Iraq sits on the world’s third-largest oil reserves, totaling more than 115 billion barrels. But the industry is plagued by lack of modern equipment and training after decades of U.N. sanctions, war and Saddam Hussein’s ruinous rule.

The war-torn country is planning to increase its current 2.4 million barrel per day oil output to 3 million barrels a day by the end of 2008 by employing foreign companies’ expertise.

It is also targeting production of 4.5 million barrels a day by end of 2013.

Early of this month, Iraq’s Cabinet gave the nod to the Oil Ministry to sign agreements with international oil companies to help increase crude output.

The two-year deals, known as technical support agreements, or TSAs, are designed to develop five producing fields to add 500,000 barrels per day.

For this, Royal Dutch Shell PLC (RDSB), BP PLC (BP), ExxonMobil Corp. (XOM) and Chevron Corp. (CVX) submitted last December technical and financial proposals for the five oil fields and received counterproposals from the Iraqi side.

In January, representatives from the companies and from Iraq met again in Amman, Jordan, and they held the third round of discussions last week.

According to the Oil Ministry official, BP will submit a proposal for the Rumaila oil field, Chevron for West Qurna stage 1, Exxon for Zubair, and Shell for Missan and Kirkuk.

Iraq also is also planning to issue its first round of tenders to develop other vast oil fields during the second quarter of this year for which 115 oil companies filed their registration documentation for qualification.

A measure aimed at regulating foreign investment in Iraq’s underdeveloped oil sector, and distributing its revenues among the nation’s Sunni and Shiite Arab communities and the large Kurdish minority, has been bogged down in parliament since February 2007.

http://www.iht.com/articles/ap/2008/03/22/business/ME-FIN-Iraq-Oil-Fields.php

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