July 1st, 2009

The Results

 

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If you are trying to figure out who won and who lost in Iraq’s first bid round, consider this:

  • 22 companies have participated in the licensing round making offers for six oil fields and one gas field, as leaders or members of consortia. One gas field, Mansuriya had no takers.
  • China’s CNPC was the most aggressive taking part in 5 offerings followed by Malaysia’s Petronas which targeted 4. Oil majors Exxon Mobil and Royal Dutch Shell aimed for 3 each, and so did Turkey’s TPAO and China’s Sinopec. BP, ConocoPhillips as well as China’s CNOOC and Korea’s Kogas targeted 2 each. The remaining 12 companies participated in bids for one field each.
  • The Lowest remuneration fee bid for an oil field was $2.6/bbl offered by a consortium led by CNPC for West Qurna and the highest for an oil field was $26.7/bbl made by the ConocoPhillips-led consortium for Bai Hassan. The Akkas gas field drew a remuneration fee bid of a staggering $38/Boe from a consortium led by Italy’s Edison.
  • The highest maximum remuneration fee offered by the Iraqi oil ministry for an oil field was $4/bbl for Bai Hassan while it offered $8.5bBoe for Akkas gas field.
  • A group of BP and partner CNPC agreed to the ministry’s $2/bbl maximum remuneration fee it offered for the Rumaila field but their profit will be subject to a 35% corporate tax and will be cut by a further 25% to pay their Iraqi partner’s share. The Iraqi partner’s share of the investment is carried by the consortium as well.

And one more:

  • Had the oil ministry accepted the offer made by the highest scoring consortia for all of the 6 oil fields, it would be, in theory, producing 8.2 million b/d when all 6 reach their plateau in six years according to the plateau production target bids.

My conclusion? There’s only one winner, but it’s not the Iraqi oil sector nor the international oil companies.

Baghdad – July 1st, 2009

Results of the First Licensing Round announced in Baghdad June 30, 2009 (You need to login to view this file)

The View from Baghdad