Sunday, June 28, 2009

divvying up the spoils...,

Washington Post | Iraq is poised to open its coveted oil fields to foreign companies this week for the first time in nearly four decades, a politically risky move in a country eager to shake off the stigma of occupation.

Iraqi politicians and some veteran oil officials have said the deals are unduly beneficial to oil giants, which are viewed warily by many in this deeply nationalistic but cash-strapped country.

Oil executives have been following the matter with apprehension, industry analysts said, but they are eager to get a foothold in Iraq, which has the world's second-largest proven crude reserves and is seen as the only major penetrable market.

Iraq expelled foreign oil companies in 1972 amid a regional movement toward nationalization. Its national oil company performed well until the 1991 Persian Gulf War, which was preceded by sanctions imposed by the United Nations.

Violence and the exodus of scores of technocrats after the U.S.-led invasion in 2003 have taken a toll on the industry. Pipelines in northern and southern Iraq are in dire need of repair, and much of the equipment at functioning oil fields is outdated or underperforming.

Iraq pumps an estimated 2.4 million barrels of oil a day. With foreign capital and expertise, oil experts said, the figure could grow to 10 million in a few years.

Iraq has an estimated 115 billion barrels of proven oil reserves, second only to Saudi Arabia. Other attractive markets, such as Venezuela and Russia, have in recent years asserted more state control over the industry.