BAGHDAD Jan 9 Iraq has approved an oil
exploration deal with a Kuwait Energy-led group, a senior oil
official said on Wednesday, to take the place of Turkey's
state-owned TPAO, which the cabinet decided to expel.
Facing souring diplomatic ties with Turkey, Iraq asked
Kuwait Energy last year to acquire TPAO's shares in exploration
block 9. At the time, the Kuwaiti company held a 30 percent
"Kuwait Energy has acquired the stake of the Turkish company
TPAO, and now it's holding 70 percent of the contract, and
Dragon Oil PLC will hold 30 percent," Abdul-Mahdy al-Ameedi,
director of the ministry's contracts directorate, said in an
Iraq's oil ministry plans to sign the final deal on Jan. 27,
Baghdad has been angered by Ankara's moves to forge closer
ties with the Kurdistan Regional Government in northern Iraq,
which is in a dispute with the federal government over oil and
Turkey and Iraq have also accused each other of inciting
sectarian tensions and have summoned each others' ambassadors in
The contract provides the consortium rights to explore and
develop oil block 9, which is located in Iraq's southern Basra
OPEC member Iraq is expected to be the world's biggest
source of new oil supplies over the next few years. It plans to
open up more rounds for oil and gas blocks for auction.
A handful of international companies won bids last May at
Iraq's fourth energy auction, which had a poor showing because
of tough contract terms drawn up by Baghdad.
Iraq has offered foreign companies less attractive service
agreements, in which they receive a fee rather than the
Kurdistan's production-sharing deals, which allow them to profit
jointly from the output.