Iraq turns away from Russian and Chinese oil companies

Iraqi officials have made an unexpected statement about further partnership with Russian and Chinese companies. They threaten to cancel contracts with these companies on oil development in the southern regions of Iraq in the near future. Iraqi oil minister Faiz Shahin says Russian companies (Lukoil, Zarubezhneft, and Mashinoimport) that take part in the development of the Western Kurna oil field have fulfilled only part of their obligations while the Iraqi oil industry has suffered from international sanctions and needs intensive development. In particular, according to RBC news agency, Lukoil signed a contract for the production of 7.8 million barrels of oil in the north part of the Western Kurna oil field in 1997 for 23 years. The cost of this project is estimated at $3.5bn. The Iraqi oil minister accuses Russia and China of violating the terms of contracts. He asserts that they are already conducting alternative negotiations with oil companies of Indonesia, Ireland and Malaysia, and India. The above statements were made during a visit of a Russian delegation in Iraq. The delegation, which consisted of representatives of Russian business circles and specialists of Slavneft oil company, arrived in Iraq to negotiate on further oil and trade cooperation. It looks like the Iraqi authorities are trying to put pressure on Russia so that it takes a more active stance over lifting international sanctions against Iraq.

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