[classicman]

This is interesting and seems potentially newsworthy.

UPDATE: Iraq Lays Out Plans For First Oil-Bid Round
Dow Jones
October 13, 2008: 03:03 PM EST

(Adds comments from oil minister and U.S. oil company official; details on licensing round, production targets and provincial elections; and background)

LONDON -(Dow Jones)- Iraqi Oil Minister Hussain al-Shahristani laid out details Monday of the country's first- ever oil licensing round, and said the national government will have firm control over several oil fields that will be jointly developed with foreign companies.

Shahristani said Iraqi state-run entities will have 51% control in projects to rehabilitate six oil fields already producing crude and two natural gas fields yet to be developed. Foreign companies will have 49% in projects and operate under fee-based service contracts.

Shahristani, in London to address companies on details of the licensing round, made clear that Iraq wants to move fast with the licensing round after endless delays getting its oil sector back on its feet since the end of the U.S.-led invasion in 2003.

Foreign companies are expected to submit bids within six months and the government wants deals in place by June. Only the Iraqi cabinet, not the Iraqi parliament, will get to approve whatever deals end up being signed, he said.

"We can't afford any more delays," Shahristani told journalists after meeting officials from 35 oil companies earlier in the day.

Shahristani said the profits companies made depended on how efficiently they run their operations and how much added crude production they're able to help state-run companies squeeze from the existing fields. He wouldn't specify what type of financial fees companies stood to gain for their work.

Baghdad hopes contracts for the fields, which are expected to run for 20 years, will help boost the country's crude production capacity to 4.5 million barrels a day by 2012 from 2.5 million barrels a day now.

The details of Iraq's first licensing round come at a time when security in Iraq has improved greatly over the past year.

But political uncertainty abounds.

Iraq is expected to soon hold provincial elections, which could unleash violence. Iraq is also moving forward with the licensing round despite having no federal oil law in place, a sign of the angst Iraq's government has in boosting oil production and oil revenue. The proposed federal oil law has been delayed by almost two years due to bickering between the Northern Kurds and Baghdad over issues such as who should control which oil fields and whether the Kurds should be allowed to sign their own oil deals.