The Iraqi Oil Ministry will ask international oil companies to submit bids for developing eight oil and gas fields at the end of June, a senior Iraqi oil official said Thursday.
"We have set June 29-30 for companies to submit their bids," Abdul Mahdy al-Ameedi, deputy director general at Iraq's Petroleum Contracts and Licensing Directorate, or PCDL, told Dow Jones Newswires by telephone from Baghdad.
The PCDL will name the successful companies during the two-day bidding process, planned to be held in Baghdad, Ameedi said.
Ameedi said final contract signatures with winning international companies are expected to take place in July. Contracts would need the approval of the Iraqi cabinet first.
He said final model contract and tender protocol document for the eight fields would be issued and posted in the PCDL's first bidding round Web site either Friday or Saturday.
These documents were supposed to be handed to companies in mid-April but were delayed for few days due to technical reasons, a source familiar with negotiations with international companies said.
The PCLD has made several changes to the original model contract, which was first issued in November.
The most important change the directorate had made to the original model contract was that oil firms would have a 75% stake in the joint ventures, with state-owned Iraqi operators at the fields holding the rest, he said. That was up from a 49-51% equity stake initially proposed.
The Iraqi oil ministry is planning to award service contracts, which mean that winning companies would receive remuneration in kind for each produced barrel as well as cost fees. Big oil companies prefer deals that give them a share of profits and allow them to book reserves.
The initial model contract stated firms should bid on the cost per barrel of maintaining the same output over 20 years, and the cost per barrel of raising output. Oil companies would recover their costs from oil they pump above the baseline.
The producing oil fields in question are Kirkuk and Bai Hassan in northern Iraq, West Qurna-1, North and South Rumaila, Zubair and Missan in southern Iraq. The two non-producing gas fields are Akkas in western Iraq and Mansouriya in the center.
Baghdad hopes contracts for the fields will help boost the country's crude production capacity to 4.5 million barrels a day by 2012 from 2.4 million barrels a day now.