Total Shifts Focus from Iraq to Kurdistan
Total SA, Europe's third largest oil company, is shifting its focus from Iraq to opportunities in Kurdistan, according to CEO Christophe de Margerie. The semi-autonomous region of northern Iraq is home to about 40 percent of the country's oil reserves.
“It’s a place where there are important oil and gas reserves and contracts are better,” de Margerie said today at a press conference in Paris.
The company is looking at exploration blocks in Kurdistan. While the government has refused to recognize production-sharing agreements between foreign companies and the Kurds in the past, de Margerie said it will be up to Iraqis to decide if any new agreements should be separate.
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According to de Margerie, the last round of auctions for exploration areas in Iraq was not very attractive, and “the award for investment doesn't appear for the moment to be enough.”
Iraq opened up its vast reserves of oil to foreign investment after the Gulf War, but many find Baghdad's terms too stringent. Despite the tension it will cause with Baghdad, Total is publicly pursuing a better deal in Kurdistan as the company targets an output growth of 2 to 3 percent in 2012.