Russia, which is owed billions of dollars by Iraq for past arms deliveries, has a strong interest in Iraqi Oil development. This includes a $3.7 billion, 23-year deal to rehabilitate Iraqi oilfields, particularly the 11-15 billion Barrel West Qurna field (located west of Basra near the Rumaila field). West Qurna is believed to have production potential of 800,000-1 million bbl/d, but is currently producing only 180,000 bbl/d. In mid-December 2002, the Iraqi Oil Ministry had announced that it was severing its contract with the Lukoil consortium on West Qurna due to "fail[ure] to comply" with contract stipulations. Specifically, the Iraqis had cited Lukoil's failure to invest a required $200 million over three years.

 

During the summer of 2004, Lukoil began training Iraqi oil specialists at facilities in western Siberia, an initiative reportedly aimed at saving Lukoil's West Qurna contract. In addition to Lukoil, Russia's Soyuzneftegaz reportedly has been talking to several other companies about developing the 100,000-bbl/d Rafidain field. Soyuzneftegaz was awarded the contract in January 2003.

In January 2005, Iraq awarded contracts to several companies (Anadarko, Dome, and Vitol) to evaluate the 2-billion-barrel Suba-Luhais in southern Iraq. In September 2005, a $200 million development contract was signed with Ireland’s Petrel, with the goal of increasing Suba-Luhais production by 100,000 bbl/d by the end of 2006. Petrel also signed a deal to conduct a technical study of the Merjan block in western Iraq.

In January 2005, Iraq's State Company for Oil Projects (SCOP) awarded a $150 million contract -- the first post-Saddam era Upstream deal -- to Turkey's Avrasya Technology Engineering, for development of the Khurmala dome. Khurmala development is aimed at increasing production at the field from 35,000 bbl/d to 100,000 bbl/d, helping to compensate for declines in output at the mature Kirkuk field.

In addition to Khurmala, SCOP reportedly granted a $180 million contract to Canada's OGI Group in March 2005 to help develop the Hamrin field, located southwest of Kirkuk. Hamrin has estimated production potential of 60,000 bbl/d or higher. Work is scheduled to take 18 months to complete.