India and Iraq, which is second largest oil exporter to the country, today inked a key pact for conclusion of a 13-year-old contract for exploration of a Iraqi block estimated to hold 645 million barrels of in-place reserves under a broad-based energy cooperation agreement.
It was signed along with three other agreements after comprehensive talks between Prime Minister Manmohan Singh and his Iraqi counterpart Nouri al-Maliki on strategic bilateral, regional and international issues, including trade and Indian investments in the war-wrecked country.
At a joint press event, Singh said, "Our energy trading relationship should be turned into a strategic partnership, including through joint ventures in oil exploration" and also noted that the two sides agreed to expand cooperation in agriculture, water resource management, pharmaceuticals, health care and information technology.
"We also agreed to further strengthen our counter- terrorism and intelligence cooperation.... Peace, security and stability in West Asia and North Africa are vital to both our countries," Singh added.
On its part, Iraq has prequalified Indian companies such as ONGC Videsh Limited, MRPL and Reliance for participation in the Nasiriya Project Bid Round.
Iraq has offered three oil blocks in Middle Furat Oil Field -Kifil, West Kifil, & Merjan- on nomination basis to Indian public sector oil companies.
The MoU in energy sector envisages cooperation in the areas of upstream and downstream oil and gas activities and related infrastructure, more specifically in the conclusion of contract of Exploration Block-8 awarded to ONGC Videsh Limited, offer of data of Middle Furat group of Fields for due diligence, natural Gas, petroleum Refineries and training.
Block-8, located in the western desert in southern Iraq bordering Saudi Arabia and Kuwait, was awarded to OVL in November 2000 by the then Saddam Hussein government. However, the government formed after the US invasion of the oil-rich country sought re-negotiation of the contract which has been pending so far.
The post-Saddam Hussain regime had initially agreed to signing of a Production Sharing Contract (PSC), where OVL would have got ownership of the oil it produced from Block-8. But the success of post-war licencing rounds, where global majors committed to develop oilfields for a small fee, has seen Baghdad change track and offer a service contract to OVL.
The Block 8 already has a discovery and is estimated to hold 645 million barrels of in-place reserves, of which 54 million are recoverable.
Other documents inked included MoU on Bilateral Cooperation in Water Resources Development and management, Foreign Office Consultations and training of diplomats.
