Simon Webb, Reuters
DUBAI - China crossed the line first in the race for big oil contracts in post-Saddam Iraq and has gained a head start over Western oil majors in the competition for future energy deals.
China's biggest oil company, state-run CNPC, agreed to a US$3-billion service contract with Iraq on Wednesday. The deal could set a precedent for terms that fall far short of the lucrative contracts the oil majors had hoped for as they jostled for access to the world's third-largest oil reserves.
Starved of investment since the Gulf War of 1990-91 and the subsquent U. S.-led invasion of 2003 that removed former President Saddam Hussein, Iraq holds some of the world's last large, cheap, untapped oil reservoirs.
"The biggest significance of this deal is that CNPC will benefit as the first international oil company to be developing one of the giant discovered oil fields in Iraq in the new era," said Alex Munton, an analyst at global consultancy Wood Mackenzie.
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