Friday, December 11, 2009
Iraq oil development rights contracts awarded
UK's Shell and Malaysia' s Petronas won the bid to have the right to develop Iraqi oil field Majnoon. Majnoon reserves has 13 billion barrels of oil but currently they are producing just 46,000 barrels per day. Shell and Petronas pledge to increase the output by 1.8 million barrels per day. There are potential benefits for Iraq as it daily output is about 2.4 million barrells but it may triple over the next couple of years. This will also help Iraq in improving their economy.
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The awarding of these contracts reminds me of the video that we watched about Russia. Iraq has the third largest oil reserves after Saudi Arabia and Iran. However, I am doubtful that this wealth will trickle down to the average Iraqi. Again, the main problem is corruption. Will those with the power to award such contracts and oversee the nation's oil wealth succumb to personal greed? Very likely. When easy money is available, and a country in chaos, corruption becomes very easy, if not inevitable.
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