HomeIndustry SectorsFinance and PolicyGlencore and Vitol vie for Iraqi oil exploration rights

Glencore and Vitol vie for Iraqi oil exploration rights

Fires flare off
the gas from crude
oil at Iraq’s oldest
oil processing plant
Dubai, United Arab Emirates — ESI-AFRICA.COM — 12 September 2011 – The upstream growth plans of the world’s two biggest oil trading companies have taken a big step forward as Iraq pre-qualified Glencore and Vitol to bid for billions of barrels of oil exploration rights next January.

The Iraqi oil ministry has confirmed a Reuters report that the Swiss-based commodity trading giants, both with big upstream expansion plans, are among six new companies which pre-qualified as bidders for 12 exploration blocs that are expected to add 10 billion barrels to Iraqi reserves.

Reuters reports that the world’s biggest oil explorers have been queuing up to tap Iraq’s vast and largely underdeveloped oil fields, with its huge reserves offsetting fears over security and infrastructure challenges in a country crippled by years of war.

Although few expect Iraq to meet its target of increasing its production capacity from under 3 million barrels per day (bpd) in 2011 to rival Saudi-Arabia’s 12 million bpd in 2017, there are now 46 companies vying for the licences to try.

Glencore declined to comment on its inclusion on the Iraq bidding list, while Vitol was unavailable for comment.

The Iraqi government has also now accepted Dubai-based Dragon Oil plc , Britain’s Gulfsands Petroleum plc , China’s Zhenhua Oil, and Romania’s Romgaz as potential bidders for the next oil round.