China's CNPC ups, BP lowers stake in Iraq oil deal

BAGHDAD (Reuters) - China National Petroleum Corp (CNPC) has increased its stake in a project to develop Iraq's super-giant Rumaila oilfield, while Britain's BP (BP.L) has lowered its share, an Iraqi oil official said on Saturday.

BP and CNPC were the only oil majors to secure a deal in Iraq's first bidding round for oilfield service contracts, after other companies at the Oil Ministry's June auction baulked at what they said were stiff contract terms.

The senior official, who declined to be named, said CNPC's stake was now 37 percent, up from an original 25 percent, and that BP's had fallen to 38 percent, down from 50 percent.

Iraq's State Oil Marketing Organization will continue to hold 25 percent, he said.

BP and CNPC officials met Iraqi officials in Basra in late September as part of steps to finalize the Rumaila deal, the Iraqi oil official said, giving no timeline for completion.

"A delegation comprising of financial and administrative officials from BP and CNPC concluded a three days of meetings with South Oil Company (SOC) officials to discuss Rumaila operating and investment expenses," the Iraqi oil official said.

Iraq's SOC oversees exports and production from the southern oil hub of Basra and surrounding areas.

Talks included negotiations over the number of employees in a joint operating team of BP, CNPC and Iraqi workers.

Rumaila is the workhorse of Iraq's oil industry with a current capacity of 1.1 million barrels per day, almost half Iraq's total output of 2.4 million bpd.

To secure the Rumaila contract, BP and CNPC cut their remuneration bids to $2 per barrel from their initial target of nearly $4 a barrel.

China has been aggressively seeking crude to feed its booming economy, tapping sources in regions seen as risky or unprofitable by others.

(Writing by Mohammed Abbas: Editing by Ron Askew)