CNPC-BP sign agreement to develop Iraq’s Rumaila oilfield
12 Oct 2009
China's largest oil and gas producer, China National Petroleum Corp (CNPC) and the UK oil major British Petroleum(BP) signed an initial agreement on Thursday with Iraq's Oil Ministry to develop Rumaila, Iraq's largest oilfield.
Officials from Iraq's state-owned South Oil Company and the two oil majors signed the deal on Thursday, which will be sent to the cabinet for approval, said oil ministry spokesman Assem Jihad.
The Iraqi government will have to invest about $15 billion to $20 billion on Rumaila oilfield.
BP and CNPC had won the contract in June 2009 - the devastated country's first post-war bidding round. (See: BP-CNPC consortium wins contract in Iraq's first post-war oil field auction) Bidding for the other seven other oil and gas fields were not held because oil companies balked at the ministry's stiff payment fees.
Rumaila oilfield is Iraq's largest producing oilfield with estimated reserves to be in the region of 17 billion to 20 billion barrels, which is more than the proven reserves of some POEC members.
Its current output is 1.1 million barrels a day, almost half of Iraq's total output of 2.45-million barrels a day, and BP and CNPC have pledged to raise production to 2.85 million barrels a day over the 20-year contract.
