Iraq’s oil ministry did well in choosing different companies to represent the state stake in the consortia awarded contracts to develop oil fields. Unlike the old days when the state oil marketing organization (Somo) was considered the de-facto state partner, including in five oil deals signed before the 2003 toppling of the previous regime (two production sharing contracts with CNPC and Lukoil and three exploration contracts with PetroVietnam, ONGC and Pertamina), different representatives now sit on the management committees of each field as holders of the 25% government share in each consortium.
Somo was the state partner on the BP-led consortia that signed the Rumaila deal. Missan Oil Co (MOC) represents the state on the consortia developing the Majnoon and Zubair oil fields, while South Oil Co (SOC) represents it on the one developing Qayarah and another developing Halfaya. Iraq Oil Exploration Co (IOEC) sits on the Badra and West Qurna-1 consortia. Iraq Drilling Co (IDC) represents the state share on Najmah, and North Oil Co (NOC) on West Qurna-2 and Garraf.
The contractor in all these deals is either SOC for the Basrah fields (Rumaila, Majnoon, West Qurna-1, West Qurna-2, Zubair and Garraf), NOC for the northern fields (Najmah, Qayarah and Badra), or MOC for Halfaya.
The reasons and justifications for the new arrangements are varied. On one hand, having more than one player act as government representative distributes the responsibilities among several companies instead of putting all in the hand of one. On the other, several people among the top managers of the oil sector will gain exposure and experience form sitting on the joint management committees together with representatives of the international oil companies. There is a further financial benefit for the senior oil executives who fulfill such tasks. Finally, it goes without saying that having this variety of oil executives taking up those roles, after engaging them in the high profile signing events of the ten contracts, guarantees their backing of the entire process that lead to this conclusion.