September 09, 2007	Sunday	Sha'aban 26, 1428

NICOSIA, Sept 8: A former Iraqi oil minister says the future development of the country’s rich oil reserves will include a wide range of foreign companies, and not just US contractors.

Thamir Ghadhban told the Middle East Economy Survey (MEES), a Nicosia-based specialist industry newsletter, that when the competition for contracts begins, foreign oil companies will have to form a consortium to enter the bidding.

“We believe in the benefits of diversification,” Ghadhban said in the interview.

“We want the maximum number of international oil companies to work in Iraq to help in providing technical expertise and management skills and financial capabilities, but also to help in enhancing the strategic balance of Iraq.”

After the US-led invasion of Iraq in 2003, many observers assumed that US firms would automatically win most oil development contracts, MEES said.

Ghadhban is a leading candidate to head the Iraq National Oil Company, set to be re-established once a draft oil law receives parliamentary approval. The INOC will most likely be a partner in a consortium with the foreign firms.

Unlike most state oil companies, however, the INOC “will not have a monopoly on Iraqi land in terms of exploration,” Ghadhban said.

Iraq’s oil infrastructure has been hit by decades of under-investment as a result of successive Gulf wars, 13 years of UN sanctions and the rampant insecurity that followed the US-led invasion in 2003.

Washington regards passage of the controversial oil legislation as key to efforts at national reconciliation in the country which is wracked by an insurgency and sectarian violence.

But the measures to loosen state control of Iraq’s main natural resource have drawn strong opposition from nationalists and left-wingers who charge that the US is abusing its military presence to plunder the country, which holds the world’s third-largest proven reserves of crude.

Ghadhban said he hoped that the oil law would be approved soon.

“What I have been hearing and (after) counting numbers, I think the law has a good chance of being passed,” he told the newsletter, while adding that in the end the decision was up to the Iraqi lawmakers.

While waiting for the approval, Iraqi oil officials have been doing some preparatory work on identifying oil fields and gathering data for the eventual licensing round.

Ghadhban said he estimated contracts could be awarded in a year’s time.

“Let us say within a year. If you take other countries’ experiences of bid rounds, they usually take some time,” he said.

—AFP