(RTTNews) - Boosting Iraq's efforts to exploit its vast oil riches, a consortium led by US oil giant Exxon Mobil Corp. (XOM) has won initial rights to develop an extensive oilfield in southern Iraq having reserves of 8.7 billion barrels.

An initial pact, designed to augment oil production at the West Qurna oil field from 280,000 to 2.1 million barrels a day, was signed in Baghdad Thursday, according to the country's oil ministry spokesman Assem Jihad.

The 20-year-contract will be finalized after getting approval by the Iraqi cabinet.

The consortium, comprising Royal Dutch Shell (RDS-B) as the partner, bagged the highly profitable oil exploration rights facing off stiff competition from rival Russian, French and Chinese groups.

This is the third major deal the country's oil ministry has agreed with overseas oil consortiums this week.

Monday, Iraq struck a similar deal with Italian firm ENI (ENI.MI), which will lead a consortium to develop the Zubair oilfield in southern Iraq.

Under the deal, 200,000 barrels of oil will be extracted daily, increasing the drilling volume to 1.1 million barrels of oil a day over a period of seven years.
Tuesday, Iraq entered into an agreement with British oil major BP Plc (BP) and China's CNPC to develop the giant southern oilfield in Rumaila.

The two oil companies will extract two million barrels a day, a three-fold increase in output at the oil field having estimated reserves of 17 billion barrel.

These agreements are the first major oil deals Iraq has signed with international oil companies since the US-led invasion of 2003, which will help it immensely in achieving full production potential.

Reports say companies are eager to fix deals on Iraq's oilfields ahead of the country's general elections scheduled for January 16.

Iraq has the world's third-largest oil reserves, but sanctions against former Iraqi governments, lack of investment and decades of insurgent attacks prevented the Arab country from becoming the world's No. 3 oil producer.

Out of the country's estimated reserves of approximately 115 billion barrels, only about 2.4 million barrels are being extracted a day.

Iraq is planning to develop 85 oil and gas fields over a period of 10 years.

by RTT Staff Writer

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