Iraq Signs Oil Deal With China Worth Up to $3 Billion, 08/28/08

For the first time since 2003, Iraq has made a major oil deal with a foreign nation. The Iraqi government and the Chinese National Petroleum Corporation have drawn up a 22 year contract in which China would provide technical advisers, oil workers, and equipment to help develop the Ahdab Oil Fields, (which is capable of producing up to 90,000 barrels of oil daily), southeast of the Iraqi capital of Baghdad. This latest deal is a renegotiated version of a 1997 oil deal between China and Iraq under Saddam Hussein and may be worth up to 3 billion dollars. According to the renegotiation, China will be paid for services rendered, but will not share in the oil profits. With this deal, China will be able to get it's foot in the door of one of the most oil rich countries in the world while providing infrastructure benefits for the people of the area with a proposed power plant that would be one of the nation's largest. Former Iraqi oil minister Ibrahim Bahr al-Ulum stated that, “There are some political profits for China. They need access to Iraq, and when they need oil, at least the Iraqi people will feel that China has done something for them.” The deal still must be approved by the Iraqi cabinet, but if it is passed, work could begin on the oil fields in a matter of months.

See the article here. -V