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Woodside
Petroleum Ltd., Australia's second-largest oil
and gas company, said an insurgency in Iraq is
unlikely to disrupt a two-year co-operation
agreement signed by the company with the Iraqi Oil
Ministry last month.
The agreement includes a six-month study to identify
viable projects and assess the volume of oil and
natural gas found in fields in Kurdistan, northern
Iraq, a self-governing region where security
concerns aren't as high as in other parts of the
country, said Agu Kantsler, Woodside's director of
new ventures.
``Security issues in Iraqi Kurdistan, in order of
magnitude, are less than you'd have elsewhere in the
country,'' Kantsler said in an interview at the OSEA
2004 oil and gas conference in Singapore today. The
Kurds have organized themselves ``extremely
effectively'' since the U.S. and the U.K. imposed a
no-fly zone in the 1990s, he said.
Woodside has been spending more on exploration in
Africa and the U.S., where it expects better growth
than in Australia, and has said it plans to enter
other proven oil and gas regions. Iraq has the
world's third-largest oil reserves, according to BP
Plc.
Iraq's plans to increase capacity to 3 million
barrels a day this year were curtailed by persistent
attacks by militants against foreign contractors and
pipelines. A U.S. soldier was killed in Iraq when a
patrol came under insurgent fire yesterday in
Baghdad became the 1,000th from the U.S. to die in
hostilities since the March 2003 invasion.
``Operating anywhere in Iraq presents problems and
it's not our intention to put people on the ground
now but there is work in the way of studies,
education of people, building relationships that can
be done in the interim,'' Kantsler said.
The agreement will focus on assessing reserves found
in 1978 in the Taq-Taq oil field and the Chemchemal
gas fields discovered in the 1950s, Rob Millhouse, a
Woodside spokesman said in November.
Under the agreement, the company will also sponsor
training of Iraqi ministry staff in Perth and some
science and engineering students at a Perth
university.
The absence of Iraqi government policy on oil, of an
energy minister and of petroleum licensing laws
means there is no legal framework for investing in
exploration and production, Kantsler said.
``Right now there is no basis for any agreement in
law,'' he said. November's agreement ``is a sign of
goodwill with a view to developing these fields, or
coming to some sort of commercial agreement when the
time is right and when the legislation is in
place.''
To contact the reporter on this story:
Sri Jegarajah in Singapore at sjegarajah@bloomberg.net.
To contact the editor responsible for this story:
Reinie Booysen at rbooysen@bloomberg.net.
Bloomberg.com Australia & New Zealand
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