Iraq inks oil exploration deal with Kuwait-led group

oil1Iraqi energy officials have signed an oil exploration deal with Kuwait Energy and the UAE's Dragon Oil

A contract was inked between all parties to explore a 900 sq km block with a view to contain oil in south Iraq.

The contract was signed by Abdul Mehdi al-Amidi, Iraqi oil ministry's head of contracts and licensing, Hussein al-Mosawy of Kuwait Energy and Mark Sawyer of Dragon Oil, according to a release.

Kuwait Energy has a 70 per cent stake in the project with Dragon Oil holding the remainder.

The companies have agreed to be paid a service fee of US$6.24 per barrel of oil equivalent eventually extracted.

It is one of several agreements between Baghdad and foreign energy firms to boost oil output and explore for new deposits of energy as Iraq looks to cement its role as a key global supplier.

The original consortium that won the contract had included Turkey's TPAO, but officials announced in November that the Turkish firm would be expelled due to "non-technical issues".

Iraq has proven reserves of 143.1bn barrels of oil and 3.2 trillion cubic metres of gas, both of which are among the largest reserves in the world.

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