BAGHDAD — An Iraqi state-owned oil company, North Oil, has signed a contract with a Chinese state-owned oil corporation, CNPC, that was first negotiated during Saddam Hussein’s regime, an official in Iraq’s oil ministry said on Tuesday.
The deal is worth $3.5 billion, according to the official, deputy oil minister Ahmed al-Shamaa, and it is the first major oil-development deal that Iraq has made with a foreign company since the American invasion in 2003.
It will allow CNPC, together with another Chinese company, Norinco, to develop the Adhab oil field in the southern Iraqi province of Wasit for 20 years, Mr. Shamaa said in a telephone interview.“It has been the same contract since Saddam’s regime, but we changed it from a production-sharing contract to a service contract,” Mr. Shamaa said. “The contract includes developing the field, digging wells, laying down bibs, delivering crude oil to the national grid, and natural gas processing and delivery."
Iraq’s oil minister, Hussein al-Shahristani, was present at the signing ceremony, as was the CNPC president, Jiang Jiemin.