China to charge six dollars a barrel to develop Iraq field

BAGHDAD, Sept 3 (AFP) Iraq yesterday cleared a plan to develop an oil field by China Petroleum National Corp. at a service fee of six dollars a barrel, giving Beijing a foothold into the world's third largest oil reserves. brIraqi Oil Minister Hussein al-Shahristani said the cabinet had approved the three-billion-dollar deal that will see China's state-owned company developing the Al-Ahdab oil field in the central Shiite province of Wasit. brThe Chinese company will charge six dollars per barrel of production as service fees which would decrease gradually to three dollars, Shahristani told reporters inside Baghdad's heavily fortified Green Zone. brHe said the plan is to be produce 25,000 barrels of oil per day in the first three years. brAn Iraqi oil ministry official last month told AFP that the oil field would become fully operational in three years' time and is likely to produce oil for 20 years after that. brThe present agreement revives a 1997 contract signed by the former Iraqi regime of Saddam Hussein that granted China National exploration rights to the Al-Ahdab oil field in a deal then worth 700 million dollars over 23 years.