CNPC signs $3bn deal to build oil field in Iraq

China National Petroleum Corp (CNPC) said it had signed a US$3 billion deal to develop the Al-Ahdab oil filed in the province of Wasit of Iraq, AFP reported. The project, the first major oil development deal secured by a foreign firm since the fall of Saddam Hussein in 2003, revives a contract first signed between the parties in 1997. CNPC, along with another Chinese company Zhenhua Oil, signed a contract in Baghdad on Monday to develop the field for 23 years. Production is eventually expected to reach 115,000 barrels per day. CNPC will build and operate the oil field and take a service fee of US$6 for each barrel produced. The contract is not expected to generate any revenue for China besides the service fees, but the deal is thought to offer it an entry into Iraq’s oil reserves ahead of other countries.