Iraq to announce foreign oil deals

Iraq will at the end of June announce which major foreign oil companies have been awarded new contracts to work in the country, a government spokesman said. The deals will be service agreements in which successful bidders are paid a fee by Baghdad and not production sharing contracts where profits are shared. "The Ministry of Oil will announce the names of companies who won business contracts in Iraq's oil industry on the 29th or 30th of this month," Assim Jihad, the ministry's spokesman, said. A first round of bidding in June last year, open only to companies with experience of operating giant oilfields, saw the number of foreign firms competing for the new business whittled down from 120 to 35. Jihad, however, did not say how many foreign companies will ultimately be awarded contracts after the second round of bidding. The decision by Baghdad to award only service contracts to foreign companies differs from the country's autonomous Kurdish region, where numerous profit-sharing deals have been struck. Iraq hopes to pump six million barrels per day, up from its current stated output of around 2.2 million bpd, within the next four to five years as new projects come online. Although Iraq has the world's third largest proven reserves of oil after Saudi Arabia and Iran, development of the conflict-ravaged country's fields has been very slow. Iraq's cabinet also last month approved a bill that will hit foreign oil firms with a minimum 35 per cent corporate tax in a bid to boost revenues. Keep up with the latest business news from the region with the daily Emirates Business 24|7 newsletter. To subscribe to the newsletter, please click here .