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BAGHDAD - Iraq has set a January 31 deadline for international oil firms to register to compete for tenders to help develop the world's third-largest oil reserves, the Ministry of Oil said yesterday.
Tenders will be issued "soon" for oil extraction and service contracts in southern, central and northern Iraq but only companies that have registered with the ministry will be able to bid, it said.
"Registration of companies ... is an obligatory condition to enable them to bid for the service and oil extraction licences that the ministry intends to issue," ministry spokesman Asim Jihad said.
The development indicates Iraq wants to press ahead in bringing the companies in to help boost output, analysts said. Big oil firms such as Royal Dutch Shell and Total have been positioning for years to gain access.
"Iraq is only producing about 2.4 million barrels per day, which is very little compared with the size of the reserves it has," said Mohammad-Ali Zainy, senior energy analyst at the Centre for Global Energy Studies.
"Iraq is in dire need of money and the sooner these companies come, of course the better."
BP, Shell and Total declined immediate comment on whether they would put their names on the register.
Oil companies that have signed deals with Iraq's largely autonomous northern Kurdistan region have angered Baghdad, which has threatened to blacklist them and declared the deals illegal.
The deadline to register means, in effect, that Iraq is following through on the threat, Zainy said.
"Obviously, any one of those that has contracted with the KRG is not going to be able to participate, which means practically those companies are being blacklisted," he said.
The Kurdistan Regional Government (KRG) has awarded production sharing contracts to foreign firms, including India's Reliance, Austria's OMV and Hungary's MOL.
Iraq's Oil Minister Hussain al-Shahristani said in September that the Government will go ahead with deals, despite a failure by Iraq's main political blocs to agree on a new oil law that will set rules and guidelines for developing fields and sharing revenues.
Iraq holds 115 billion barrels of crude oil reserves, the world's third-largest after Saudi Arabia and Iran.
The draft law for managing Iraq's oil reserves was first agreed in February 2006, but disputes with the Kurdistan regional government and objections from Shiite and Sunni Arab politicians have stalled the process.
Shahristani said at a meeting of Opec heads of state in Riyadh in November that final approval of the law was months away.
- Reuters
