Iraq's November oil revenue falls as exports stabilize

Wednesday, December 24, 2008

BAGHDAD -- Iraq's oil revenue dropped sharply in November even as exports remained steady at 52.8 million barrels, the Iraqi Oil Ministry said Tuesday.

Revenue fell more than 25 percent -- to $2.3 billion from $3.11 billion in October -- because of the steep fall in world oil prices, the ministry announced.

Iraq's oil was sold at an average price of $43.542 a barrel, down from $58.902 a barrel. It was purchased by 29 international oil companies.

The data also showed that 43.5 million barrels were exported through the Persian Gulf, while 9.3 million barrels were exported via Turkey's port of Ceyhan.

Also Tuesday, the Ministry set Dec. 31 as the date to open its second licensing round for developing oil and gas fields.

Its statement added that Oil Minster Hussain al-Shahristani will kick off the bidding round at a conference in Baghdad. The statement didn't divulge the number of fields.

Iraq recently opened a first round of bidding for contracts to develop six major oil fields and two gas fields, choosing 34 of 120 companies that applied to participate.

The Ministry plans to sign these contracts in mid-2009.

Iraq sits on more than 115 billion barrels of oil and an estimated 112 trillion cubic feet of natural gas reserves but decades of wars, U.N. sanctions, violence and sabotage have battered its oil industry.

The drop in oil prices to under $50 per barrel from a summertime high of about $148 has hit Iraq hard since it depends on oil revenue for about 95 percent of its budget.

Its government was forced to slash next year's spending plan from $80 billion to $67 billion due to the crisis and now it is mulling more cuts.

Early this month, al-Shahristani appealed for help from international oil companies to triple the current daily production of 2.4 million barrels per day to 6 million barrels per day by 2018. In return, he promised "full cooperation and a transparent and competitive environment for fair business."

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