Iraq ends talks with French oil company

Iraqi Prime Minister Nouri al-Maliki, left, meets with Iran's supreme leader Ayatollah Ali Khamenei, in Tehran, Iran, Monday June 9, 2008. A photo of Iran's late leader ayatollah Khomeini, at center.(AP photo/ISNA/Forutan)

BAGHDAD (AP) -- France's Total said Thursday that Iraq has ended negotiations to develop an oil field in southern Iraq, one of six reported cancellations of no-bid contracts with Western oil companies.

The French oil firm and U.S.-based Chevron were jointly negotiating a technical support agreement for the development of West Qurna oil field near the southern city of Basra.

"We are disappointed in not being able to successfully conclude these negotiations," Total spokeswoman Lisa Wyler told The Associated Press in an e-mail. "We are committed to working with the Ministry of Oil to consider further development opportunities within the oil and gas industry in Iraq."

Paris-based Wyler gave no reasons for the cancellation.

West Qurna field has reserves estimated at 15 to 21 billion barrels, according to the Iraqi Oil Ministry. The ministry has intended to add 100,000 barrels a day to the field's current capacity of about 180,000 barrels a day. Its estimated production capacity before the U.S.-led invasion of Iraq in 2003 was 250,000 barrels a day, ministry figures show.

The Iraqi Oil Ministry was also negotiating with Royal Dutch Shell PLC, BP PLC and ExxonMobil Corp. and some smaller companies to increase crude production in at least five other fields under the same agreement.

Citing participants in the negotiations, The New York Times reported Thursday that plans to award six no-bid contracts to these oil companies were withdrawn. The newspaper said Iraqi Oil Minister Hussain al-Shahristani told reporters at an OPEC meeting in Vienna on Tuesday that delays in talks had made it impossible for the companies to fulfill the work under one-year deals.

Iraq's negotiations with Western oil companies triggered criticism that U.S.-led forces toppled Saddam Hussein in order to gain access to Iraq's vast oil reserves. Charles Ries, the outgoing chief economic official at the U.S. Embassy in Baghdad, said last month that some companies had decided one-year contracts were not worth the investment.

Iraq has the world's third-largest oil reserves, totaling more than 115 billion barrels. But its industry has been battered by years of war and sabotage, as well as U.N. sanctions during Saddam Hussein's rule.