Baghdad - A group led by British Petroleum (BP)on Tuesday won rights to develop Iraq's Rumaila oil field, the largest of six oil fields on offer in a two-day bidding war in Baghdad. BP and China's CNPC won the rights to develop the largest of six oil fields which were on offer in major bidding by foreign firms in Baghdad to develop oil fields in cooperation with Iraqi partners.
Bringing more than 32 of the world's largest oil companies against each other, the bidding marks the first time since the 2003 fall of Saddam Hussein that foreign oil companies will be allowed to work Iraqi oil and gas fields controlled by the central government.
The Rumaila oil field, which is thought to contain some 3.3 trillion cubic feet of oil reserves, lies in Iraq's volatile Diyala province that has been the scene of some of the worst fighting in Iraq.
However Prime Minister Nuri al-Maliki sought to allay security fears in his opening remarks to the conference. "We will offer the winning companies all security protection they need to facilitate their success and the success of the oil investment process," he said.
"In a country devastated by wars and adventures, energy became our sole resource. Today is just the beginning of the investment process," al-Maliki told government ministers, ambassadors and representatives of some of the world's largest energy firms assembled at Baghdad's Rashid Hotel.
The conference came on the day US forces officially withdrew from most Iraqi towns and cities.
Iraqi Oil Minister Hussein al-Shahristani told delegates that the government had opened the proceedings to the media "to inform the Iraqi people and to make sure that their rights are not compromised."
Even if oil were at 50 US dollars a barrel, al-Shahristani said, the proceeds from the new investment could top 1.7 trillion US dollars over the next 20 years. Oil futures were at about 70 dollars per barrel on Tuesday.
The companies competed for rights to develop some of the most important oil and gas fields in Iraq, including southern Iraq's Zubair and Rumaila fields, and northern Iraq's Kirkuk field.
Iraq is OPEC's third-largest oil producer, with a daily production of 2.4 million barrels per day (bpd). The government hopes that the contracts could double that production, to 4 million bpd.
Estimates of the country's total recoverable oil reserves range between 115 and 215 billion barrels. Saudi Arabia, the world's biggest oil exporter, has an estimated 267 billion barrels of oil.
