jord wrote:
JohnG@lt wrote:
jord wrote:
Aren't they about to auction off massive deposits in Iraq that would put them the in the top 3 oil distributors?
It's not in my fucking interest the price goes up, expensive enough as it is to drive...
The auction happened last week.
Oh, did BP get any?
Yeah, BP, Shell and the Norwegians got the biggest fields I think. Do a WSJ search, it was in there last week.
BAGHDAD -- Iraq awarded some of its most promising, untapped fields to a variety of foreign bidders in a two-day auction Friday and Saturday that Iraqi officials held up as an endorsement by international investors.
Companies that won fields over the weekend -- including Royal Dutch Shell PLC and Russia's Lukoil Holdings -- and companies that have won deals already this year have pledged to more than triple the country's oil output.
Iraqi officials hailed the auction as the clearest sign yet that Baghdad is on its way to rebuilding its vast but hobbled oil industry, and more broadly, reasserting its regional economic power. The auctions lend "more credence that Iraq is coming back, and Iraq is strong" again, Hoshyar Zebari, Iraq's foreign minister, said in an interview over the weekend.
Big challenges still loom for Iraq and the companies, including winning final government approval for the deals. Iraq has scheduled parliamentary elections for March, and there is some worry among Iraqi officials themselves and oil executives that a new government could reconsider the deals.
But the current government of Prime Minister Nouri al-Maliki has strongly backed the country's two auctions so far. In June, Iraq held its first oil auction, offering foreign companies the chance to boost production at already-pumping fields. This weekend's auction was the first time foreign firms could bid on untapped fields.
If the companies that won fields over the weekend live up to their production pledges, they would increase the country's oil production to 4.765 million barrels a day, the country's oil minister Hussein al-Shaharistani said on Saturday. That's up from current production of around 2.5 million barrels a day.
"It is a very successful bid round," Mr. Shahristani said Saturday.
The estimate of 4.765 million barrels a day doesn't include production increases pledged by companies that won field-development contracts in previous months for already producing fields. All told, international consortia have committed to boosting Iraqi production capacity to 12 million barrels a day, Mr. Shahristani said. That would rival the output of Saudi Arabia, the world's largest oil exporter.
Reflecting that optimism, Mr. Shahristani said Saturday that Iraq would be ready to eventually accept a production quota from the Organization of Petroleum Exporting Countries. Iraq is an OPEC member but has long been exempted from the output quota that other members adhere to, in a mechanism aimed at managing global prices.
By many estimates, Iraq sits on the world's third largest reserves of oil, behind Saudi Arabia and Iran. But the Iraqi industry has struggled for years because of United Nations sanctions, war and under-investment.
Production growth won't be easy. Legal hurdles remain. The oil ministry and Mr. Maliki's government designed the current contracts -- essentially service contracts that pay out a per-barrel fee to oil companies in exchange for production increases -- without parliamentary approval. A petroleum law setting out the legal framework for foreign oil development has been marooned in parliament, and a new government next year could object to the current contracts.
Technical worries also persist. Fields, especially untapped ones, often prove more technically challenging than expected or result in fewer reserves than anticipated. For currently producing fields, decades of overproducing by Mr. Hussein may have caused irreparable reservoir damage, oil analysts have long warned.
Still, interest from foreign firms was high. Executives from more than 30 international oil companies came to Baghdad to bid for the oil fields, despite a volatile security situation. A series of coordinated bombings in Baghdad last Tuesday killed more than 100.
A consortium led by Shell and Malaysia's Petronas won Majnoon, a giant field that could hold some 12 billion barrels of reserves, on Friday. The consortium proposed a remuneration fee of $1.39 and pledged to increase output to 1.8 million barrels a day. Lukoil along with Statoil Hydro secured a deal Saturday to develop another big field, West Qurna Phase 2. They proposed a fee of $1.15 a barrel and a production plateau of 1.8 million barrels a day.
Mr. Shahristani told the winning companies to come to Baghdad in two weeks to work out initial agreements, and then he will send the draft contracts to the cabinet for approval. He expects the final signing of these contracts to take place early next year.
http://online.wsj.com/article/SB126064193056889083.html2 weeks ago, not one week. My bad
I find it interesting that countries like Norway and Russia, countries that condemned the invasion, are going to profit so handsomely from it's aftermath.
Last edited by JohnG@lt (2009-12-26 08:59:36)
