Saturday, April 07, 2007
Asian companies likely to get first Iraqi oil contracts
Oil
(India Times) - Despite whispers in some quarters that the Bush administration invaded Iraq to take control of its oil, the first contracts with major oil firms from Iraq's new government are likely to go not to US companies, but rather to firms from China, India, Vietnam, and Indonesia. "While Iraqi lawmakers struggle to pass an agreement on exactly who will award the contracts and how the revenue will be shared, experts say a draft version that passed the cabinet earlier this year will likely uphold agreements previously signed by those countries under Saddam Hussein's government," CNNMoney.Com has said in a report citing energy experts.
"The Chinese could announce something within the next few months" if all goes well with the oil law, James Placke, a senior associate at Cambridge Energy Research Associates who specializes in the Middle East has been cited in the report. The Asian firms are advantaged and for several reasons: they are less constrained by Western sanctions during the Hussein regime, they've been operating in Iraq and know the country's oilfields, according to Falah Aljibury, an energy analyst who has advised several Iraqi oil ministers as well as other OPEC nations.
Aljibury said the first contracts likely awarded will be to the Chinese in the south central part of Iraq, the Vietnamese in the south, the Indians along the Kuwaiti border, and the Indonesians in the western desert;but that the contracts under consideration are small. According to Aljibury, the Chinese agreement is to produce about 70,000 barrels of oil a day, while the Vietnamese one is for about 60,000. The report said it is hard to to put a dollar amount on what those contracts might be worth, as security costs, drilling conditions and the exact terms to be offered by Baghdad are unknown. But the barrel amount is tiny even by Iraq's depressed post-war production of around 2 million barrels a day.
Labels: China, contracts, India, Indonesia, oil, Vietnam
