US-backed crackdown in Basra paves way for opening up Iraq's oil and gas

On April 16, Oil Minister Hussain al-Shahristani announced that four undeveloped oil fields in southern Iraq will be tendered to international companies in coming monthsthree in Basra province. The massive Akkaz natural gas field in the western province of Anbar and an untapped oil field near the northern city of Kirkuk are to be offered up as well. Earlier this month, the Oil Ministry published the names of the first 35 companiesout of 120 that applied for licenses to operate in the Iraqi oil industrythat will be permitted to make bids.

The Akkaz gas field, which is believed to hold seven trillion cubic feet of natural gas, will be developed from start-up production of 50 million cubic feet per day to as much as 500 million cubic feet per day. The long-term plan is to extend an existing pipeline to Syria into Turkey, and sell gas on the lucrative European Union markets. The supply of Iraqi gas to the EU was one of the main agenda items during a two-day visit to Brussels by Iraqi Prime Minister Nouri al-Maliki in mid-April.

The aim of the southern oil projects is to increase Iraqi production by at least 500,000 barrels to close to three million barrels per day. Longer term, the opening up of dozens of other untapped fields is anticipated to enable production to be pushed to between six million and 10 million barrels per day. Iraq has estimated oil reserves of 115 billion barrels, though one analyst, Fadhil Chalabi of the London-based Centre for Global Energy Studies, puts the figure at more than 300 billion barrelsthe largest reserves in the world.

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