Iraq invites French and US oil firms to bid for contract

CONTRACT BIDS: Iraq has asked three global oil firms to bid for the contract to develop the 6 billion barrel Nahr Bin Umar oilfield. (Getty Images)

Iraq has invited France's Total and US firm Chevron Corp to jointly bid against Norway's StatoilHydro for a contract to develop its 6 billion barrel Nahr Bin Umar southern oilfield, the Oil Ministry said on Tuesday.

"The Total and Chevron consortium are favoured to win this contract because they have together studied a group of Iraqi oil fields, including Nahr Bin Umar," a senior official in the ministry said.

The official added that two other fields in that study were Majnoon and West Qurna Phase I, both of which were among fields offered up in two bidding rounds that Oil Minister Hussain Al Shahristani announced last year.

The first of those rounds will be awarded by the middle of this year and the second by the end. The Nahr Bin Umar contract was nothing to do with those rounds, the official said, adding that the ministry was waiting to receive the firms' offers.

The field in Iraq's southern oil hub of Basra produces just 50,000 barrels of oil per day (bpd), despite its proven reserves of at least 6 billion barrels, the ministry said.

It has the capacity to produce 10 times as much, it added.

A third company would be invited to join in the bidding process but it had not yet been decided which one, the Oil Ministry official said.

Iraq is aggressively courting foreign investment in its oil industry in an effort to modernise creaking infrastructure devastated by decades or war, sanctions and neglect.

Shahristani has said he wants to raise production to 6 million barrels per day in the next five to six years, from its current average of 2.4 million.

"This offer is part of our accelerated plan to boost oil production through EPC (engineering, procurement and construction) contracts," the official said. (Reuters)

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