November 3, 2009 British-Chinese consortium signs Iraq oil deal

BAGHDAD (AP) - Iraq has finalized a deal with a British-Chinese consortium to develop the country's largest oil field, a key step in its effort to revamp its dilapidated oil sector.

BP and CNPC were the only companies to be awarded a contract during the OPEC member's June licensing round - the country's first such auction in over 30 years. The deal, completed Tuesday, covers the Rumaila field, a 17.8 billion-barrel field in southern Iraq.

The consortium wants to almost triple Rumaila's current output to 2.85 million barrels per day in seven years, up from 1 million barrels per day.

Under the 20-year contract, BP and CNPC will receive $2 for every barrel of crude produced.

BP will hold 38 percent stake in the project to CNPC's 37 percent. Iraq holds the rest.

(Copyright 2009 by The Associated Press. All Rights Reserved.)