DUBAI (Reuters) – Iraq is in advanced talks for an oil service contract with a consortium of Vitol, Anadarko and Dome to boost output by 100,000 barrels per day at its Luhais oilfield, industry sources said on Wednesday.
The contract is the sixth in a batch of short-term oil service contracts worth around $500 million each that Iraq wants to sign with international oil companies in June.
Baghdad aims to increase oil output by around 600,000 bpd with the deals, boosting by over a quarter Iraq’s current output of around 2.25 million bpd.
“A final round of meetings is expected to be held with the consortium, and all of the companies negotiating these contracts, at the end of this month,” said an industry source. “All companies involved are finalizing paperwork to initial the agreements in early June.”
The consortium of European oil trader Vitol, U.S. independent oil and gas company Anadarko and Dubai-based Dome has already taken part in two rounds of talks with Iraqi officials in Jordan’s capital of Amman for the contract. The Luhais oilfield is in southern Iraq and pumps around 50,000 bpd.
Iraqi Oil Minister Hussain al-Shahristani said last month he wanted the oil service deals the country was negotiating with international oil giants to be signed in June, or Baghdad may drop the deals.
BP, Royal Dutch Shell and Exxon Mobil were negotiating a deal each. Shell is negotiating another deal with BHP Billiton, while Chevron and Total together are working on a fifth deal.
The service contracts form part of stopgap measures to boost oil production in the absence of a vital oil law. Legislation to set the terms and extent of foreign investment in the country has been stalled in parliament for more than a year.