(Adds oil minister quote, details)
BAGHDAD, March 22 Iraq signed a $1 billion
oilfield service contract with South Korea's Samsung Engineering
on Thursday for its West Qurna Phase Two oilfield.
The deal is part of an initial development plan approved by
Iraq's oil ministry in 2010 to start production of the untapped
oilfield in the south.
"The project includes building a complete establishment on
the ground to produce oil of around 500,000 barrels per day,"
said Iraq Oil Minister Abdul Kareem Luaibi.
"We consider this the first phase of the (total) project,
which includes producing 1.8 million bpd."
Five companies, including Saipem, SNC Lavalin
Group Inc, Punj Lloyd Ltd, Globalstroy
Engineering and Samsung, were short-listed last year
to compete for the contract.
Tenders announced were for construction of an oil export
pipeline, a tank farm at Tuba, a power distribution station and
an associated gas processing plant, and also an oil gathering
system, central processing facilities and a water supply system.
Russia's LUKOIL and Norway's Statoil sealed a 20-year deal
to develop the virgin field in an auction in December 2009,
pledging to boost output to a plateau target of 1.8 million bpd
in six years.
Statoil said in February it wanted to sell its stake in the
giant 12.9 billion barrel oilfield to Lukoil.
(Reporting by Aseel Kami; Writing by Serena Chaudhry; Editing
by James Jukwey)