BP wins bid to develop Iraq's biggest oilfield

OIL AUCTION: Major oil companies are taking part in Iraq's oil field auction. (Getty Images)

Iraq’s Oil Ministry announced a consortium led by the UK’s BP has accepted a contract to develop the country’s biggest oilfield – the 17-billion barrel Rumaila field in the south.

The consortium, which includes China's CNPC, accepted the deal after Exxon Mobil rejected the government’s $2 a barrel limit. BP's initial bid was for $3.99 per barrel.

"We asked each of the companies to accept and BP and CNPC accepted the ministry's figure and for that reason their bid is accepted," said Oil Minister Hussain al-Shahristani.

In a statement emailed to ArabianOilandGas.com a BP spokesman said: "BP and its partner China National Petroleum Corporation (CNPC ) are very pleased to have participated in the transparent and efficient process today.

"We are looking forward to the next step towards finalising the service contract to increase production of the Rumaila field. We will give further information upon finalisation of the contract."

Most of the world’s major oil companies are taking part in an auction for six Iraqi oil fields and two gas fields on Tuesday. The contracts on offer are worth a total of $16bn.

Reuters reported the ministry had not received any offers to develop the country’s 3.3 trillion cubic feet Mansuriyah gas field.

A consortium led by Edison International bid for the 2.1 trillion cubic feet Akkas gas field. The firm’s partners include Malaysia's Petronas, China National Petroleum Corp, Korea Gas and Turkish Petroleum Corp.

While a consortium led by ConocoPhillips was the sole bidder for the 2.3 billion barrel Bai Hassan oilfield in northern Kirkuk province. Four bids - from BP, India's ONGC, Italy's ENI and Exxon Mobil - were received for the 4-billion barrel Zubair oilfield.

It is believed that Iraq’s reserves of oil could rival Saudi Arabia’s if the fields are developed with the right expertise and that the contracts on offer could yield upwards of $1tn over the next 20 years.

Full list of Iraq oil contract bidders

BHP Billiton, Eni, LUKoil, Occidental Petroleum, Sinochem, BP, ExxonMobil, Maersk Oil, ONGC, Sinopec, Chevron, Hess Corp., Marathon, PT Pertamina, StatoilHydro, CNOOC, INPEX Corp., Mitsubishi, Petronas, Total, CNPC, JAPEX, Nexen, Repsol-YPF, Turkish Petroleum Corp. (TPAO), ConocoPhillips, Gazprom Neft, Nippon Oil, Shell, Woodside Petroleum, Edison, Korea Gas Corp. (KOGAS)

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