Iraq sweetens oil contract terms (07/10/05)

Iraq's South Oil Company has reissued a tender to drill 32 oil wells, easing the conditions to attract international firms that have stayed away from the project, oil executives and Iraqi officials said.

32 Oil wells to be drilled

Armed with a $3 billion budget, the Iraqi Oil Ministry has been trying to employ large contractors to help raise production in the south, which accounts for most of the country's 1.5 million barrels per day (bpd) of exports. Only three companies - two Iraqi and one Syrian - submitted bids when the drilling tender was first issued in January, oil executives said.

"The South Oil Company was hoping to see international companies with their own oil rig fleets participate," one executive said.

The 32 wells, mostly in the West Qorna field, are estimated to cost $20 million to drill and take a month each to finish. An Iraqi oil official confirmed that the tender has been reissued, saying the deadline is 15 October and winners are due to be chosen a month later.

"We want to see local and Arab companies set up joint ventures with multinationals to be in a stronger position to participate," he said.

The state-owned South Oil Company has also reissued tenders to study the condition of the Basra and Khor Al Amaya terminals offshore in the Gulf and the two export pipelines feeding them, the official said.

Source: TradeArabia