FX.co ★ Iraqi Oil Ministry denies Reuters version of TotalEnergies deal

Following media reports about a $27 billion Iraqi deal with France's TotalEnergies, the Iraqi Oil Ministry denies its risk of non-agreement.

Reuters reported that the deal between Iraq and TotalEnergies stalled due to disagreements over terms and risks.

In response to the report, the Oil Ministry released a statement that it was surprised by this inaccurate information.

Last September, a French national signed an agreement with the Iraqi government to develop four large-scale energy projects in Southern Iraq.

One of the projects to increase oil recovery will include the injection of seawater into oil fields. Another project will be a $2 billion gas processing plant for gas from five large southern oil fields. The contract also includes another oil recovery enhancement project at the Ratawi oil field, which should increase production from 85,000 barrels per day to 210,000 barrels per day, as well as a solar power plant.

According to Reuters' report this week, the terms of major deals that have not been made public have caused concern among some Iraqi politicians. The report says that they are unprecedented for the country.

The concern prompted a group of Shiite MPs to write to the Oil Ministry and ask why the contract was signed without a tender and transparency. Reuters reported that it had seen a copy of the letter.

Among the conditions that have emerged since then, there is a provision that the initial investment in projects for $ 10 billion owed to TotalEnergies from the sale of oil produced at the Ratawi oil field will come from the Kingdom.

These fees represent 40 percent of Ratawi's total revenue, well above the usual 10-15 percent rate in traditional maintenance contracts, according to Reuters sources.