(ARAB TIMES) A landmark Iraqi auction for oil and gas exploration blocks was a disappointment because of poor contract terms on offer and a lack of requisite energy infrastructure, analysts say. The May 30-31 auction, the fourth of its kind to be organised by Baghdad in the past three years and the first to offer acreage for oil and gas exploration since the 2003 US-led invasion, ended with just three deals awarded out of 12 blocks on offer, and eight plots receiving no bids whatsoever.
Iraq’s oil ministry painted the bid round as a success, with one official arguing that a success rate of 25 percent was a “good result.” Analysts, however, disagreed. “It was not a success,” said Ruba Husari, editor of iraqoilforum.com. “It was not a success because the main aim of Bid Round Four was to find gas and develop it.” Husari pointed to two key obstacles — poor energy infrastructure in many of the exploration areas, particularly in Iraq’s western desert which is thought to hold gas; and contract terms that required firms to specify how much money they wanted to receive, without knowing how much energy was in the blocks.