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Iraq Warns Russia Over Oil Fields

Iraq warned Russia's top integrated oil company on Thursday that it risked losing contracts to develop huge oil reserves by failing to implement them. Deputy Oil Minister Faiz Shaheen said OAO Lukoil, partly owned by the Russian government, had signed contracts to exploit the giant West Qurna deposit and other fields in southern Iraq in 1997.

Iraq warned Russia's top integrated oil company on Thursday that it risked losing contracts to develop huge oil reserves by failing to implement them.
Deputy Oil Minister Faiz Shaheen said OAO Lukoil, partly owned by the Russian government, had signed contracts to exploit the giant West Qurna deposit and other fields in southern Iraq in 1997.
``There are binding oil-field development contracts between Iraq and companies from Russia and China and others. Any contract that is violated by non-implementation on the ground will no longer be valid,'' Shaheen told The Associated Press.
Russia and China have pushed for an easing of the U.N. trade sanctions maintained on Iraq since its invasion of Kuwait in 1990, but they respect the embargo. U.N. resolutions say it can be lifted only when Iraq proves to the world body that it has eliminated its weapons of mass destruction.
Iraq is anxious to increase its oil production now that oil prices are relatively high and the United Nations has authorized it to export as much crude as it likes. The exports are part of the oil-for-food program under which oil revenues must be spent on food, medicine and essential goods approved by the United Nations.
Shaheen reminded Russia of its support for Iraq over the crippling sanctions that have caused shortages and malnutrition among children.
``We awarded the contract (West Qurna giant oil filed) to the Russian people and the Russian government, and they must give us implementation and performance in return or suggest an alternative solution,'' Shaheen said.
Iraq has previously threatened to act if the contractors do not develop the fields, but it has not abrogated the contracts.
Neftegaz.ru