Iraq reached a $27 billion oil agreement with French company TotalEnergies last week, which allows for quicker and less risky repayments by enhancing revenue-sharing. This model may be replicated by Iraq in the future to attract investors. Two Iraqi oil officials stated that the new agreement aims to allow Total to obtain a share of the revenues from the Artawi oil field in the energy-rich Basra region and use it to help finance three additional projects.
Total indicated to Reuters that the contract "differs from previous technical service agreements regarding the degree of risk and profits shared between the state and investors." In addition to increasing production at the Artawi field, the agreement includes a solar power generation plant with a capacity of one gigawatt, a facility to process 600 million cubic feet of gas daily, and a seawater supply project that is crucial for supporting oil production in southern Iraq.
Total will hold a 45% stake, the state-owned Basra Oil Company will hold 30%, and QatarEnergy will hold 25%. A senior Iraqi oil official noted that revenues will be divided according to these shares. The "Integrated Energy Project in Iraq" aims to improve electricity supplies by capturing gas that burns during oil extraction in three oil fields and using it in power generation stations, which also helps reduce Iraq's import costs.
Total stated that it will invest in all four projects simultaneously, with the solar power plant expected to start operations by the end of 2025 and gas recovery anticipated to begin in 2027. "The revenues from the Artawi field primarily allow us to finance the other projects," Total added in its statement.
