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Tuesday, January 26, 2010     FOR YOUR EYES ONLY

Iraq signs major oil deal with U.S., Italian firms

BAGHDAD — Iraq has signed a crude oil deal worth more than $26 billion.


Iraq's Oil Ministry has signed a deal with Italy's Eni and the U.S. firm Occidental Petroleum to enhance the Zubair oil field, with an estimated reserve of 4.2 billion barrels.

Under the agreement, Eni and Occidental would spend about $1 billion annually for the next 20 years to increase production at Zubair by one million barrels per day.

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"They will start working to create a development plan and rates of production and investment," Iraqi Oil Minister Hussain Al Shahristani said on Jan. 22.

Under the deal Eni and Occidental would join South Korea's Korea Gas Corp. to develop Zubair, with a current oil production of 200,000 barrels per day. Eni was expected to spend $11.4 billion in the project to bolster Zubair's output to 1.2 million barrels per day. Korea Gas said it would invest $6.5 billion, and Occidental was expected to contribute more than $8 billion.

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