Chinese Companies Dominate Licensing Bids to Explore Iraq Oil and Gas Fields as US Snubs Energy Bidding Round

By Jace Dela Cruz

May 13, 2024 01:16 AM EDT

Chinese companies won five more bids for licenses to explore and develop oil and gas fields in Iraq as the hydrocarbon exploration licensing round of the Middle Eastern country entered its second day. 

A picture taken on April 4, 2023 shows the Nahr Bin Omar oil field and facility near Iraq's southern port city of Basra. - Major oil powers led by Saudi Arabia announced a surprise production cut of more than one million barrels per day on April 2, calling it a "precautionary" move aimed at stabilising the market.
(Photo : HUSSEIN FALEH/AFP via Getty Images)

Chinese Companies Win 5 More Bids to Explore Oil and Gas Fields in Iraq

According to Reuters, Iraq's oil minister, Hayan Abdul Ghani, said on Sunday that among the notable awards, China's CNOOC Iraq prevailed in its bid to develop Iraq's Block 7 for oil exploration, which spans the provinces of Babil, Diwaniya, Najaf, Muthanna, and Wasit, while Geo-Jade triumphed in a bid to develop the Jabal Sanam field for oil exploration in Basra province.

Other Chinese companies, such as Anton Oilfield Services, Sinopec, and ZhenHua, won bids to develop the Dhufriya field in Wasit, the Sumer oilfield in Muthanna, and the Abu Khaymah field in Muthanna, respectively. 

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No US Oil Majors Have Participated in Bidding in Iraq

Chinese companies have dominated the bidding since Saturday. They are the only foreign players to secure licenses to cover 10 oil and gas fields. Chinese companies have already won five bids on Saturday. The Iraqi Kurdish company KAR Group took two of the oil and gas licenses for the 29 projects in the three-day licensing round.

This licensing round aims primarily to boost oil and gas production for domestic consumption. Iraq wanted to increase natural gas output to power domestic power plants, reducing its reliance on imported gas from Iran. 

Over 20 companies, including European, Chinese, Arab, and Iraqi groups, have pre-qualified for the licensing round. However, no bids were made on six fields with gas potential.

Interestingly, Reuters reported that no US oil majors participated in this licensing round despite Iraqi Prime Minister Mohammed Shia meeting with representatives of US firms during his official visit to the US last month.

READ MORE: Middle East Conflict Could Push Oil Prices to the Top and Drive Global Inflation, Says World Bank

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