Source:
WaPoBAGHDAD -- Exxon Mobil and Royal Dutch Shell signed a deal with the Iraqi Oil Ministry on Thursday to develop a major field, marking the first foray by a U.S.-led consortium into Iraq's promising but uncertain oil industry.
The agreement, the second of its kind signed this week, suggests that foreign companies that initially balked at the terms the ministry offered at a public auction in June now think the prospect of eventually tapping into Iraq's vast oil reserves outweighs the risks. Oil Minister Hussain al-Shahristani called the deal "another huge achievement in the pursuit of rebuilding this country."
~snip~
The deals are all for service contracts, which give the companies a per-barrel fee for boosting output at active fields encumbered by old technology and derelict equipment. But they do not give the energy giants a stake in the profits.
Industry experts say the contracts are likely to be only modestly advantageous, if at all, to Western energy giants in the short term but could position them to reap a windfall if Iraq opens unexplored oil fields to foreign companies.
~snip~
Since the 2003 U.S.-led invasion of Iraq, foreign oil companies have sought to penetrate the country, which has one of the largest proven crude reserves in the world. The firms continue to be wary of the violence, corruption and political instability in the country but are growing more tolerant of risk as other large markets such as Venezuela and Russia adopt increasingly nationalist policies.
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http://www.washingtonpost.com/wp-dyn/content/article/2009/11/05/AR2009110501375.html?hpid%3Dmoreheadlines&sub=AR
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