In an effort to accelerate the process of awarding contracts to international oil companies (IOC), the Iraqi Oil Ministry has sent out a revised copy of a model contract for the eight oil and gas fields included in the first bidding round.Â
Speaking to the Dow Jones Newswires, Abdul Mahdy al-Ameedi, deputy director general at Iraq’s Petroleum Contracts and Licensing Directorate (PCDL) said: “We had sent out to bidding companies on March 19 a semi-final version of the model contract.”
IOCs have been asked to give feedback on the new contract by April 1. The PCDL will then issue the final contracts between April 15 and April 17.
“Companies would have two and half months to study the final model contract and submit their offers by the end of June this year,” the official said.
According the Ameedi a number of alterations have been made to the original model contract issued by the the PCLD in November of last year.
The key change in the new contract is that IOCs would now have a 75% stake in the joint ventures it agrees with the state-owned Iraqi operators. This has been increased from the original 49/51 equity stake that was originally offered.Â
The service contracts differ from the ones usually preferred by IOCs. The Iraqi Oil Ministry plans award contracts which would mean companies with successful bids receive renumeration in kind for each produced barrel as well as cost fees. IOCs prefer a contract that offers both profit shares and the ability to book reserves.
The Iraqi government hope that the new contracts will boost the country’s crude oil production from the current level of 2.4 million barrels per day (bpd) to 4.5 million (bpd) in 2012.Â
