Baghdad officials said the deal with China National Petroleum Corp. could come as early as next week, Abu Dhabi's The National reported. The deal replaced a contract with the Chinese firm brokered under the Saddam Hussein regime.

Western oil firms, including Royal Dutch Shell and others, said they are in talks with Iraq to rebuild the war-torn energy infrastructure.

Western production-sharing contracts cannot move forward, however, until Baghdad establishes a new federal hydrocarbon law.

Baghdad pulled out of earlier negotiations on a $500 million technical service contract with U.S.-based Anadarko Petroleum for the southern Iran Luhais oil field, though discussions continue with other energy majors.

Norway's DNO halts activity in northern Iraq
Norwegian oil firm DNO said a license review by the Kurdistan Regional Government resulted in a cessation of oil output from the northern Tawke field.

DNO said the Kurdish government initiated a review of its "licensing, compliances and uniformity of procedures" in an effort to regulate supply and quality from the field, Middle East Business Intelligence said.

DNO said it produced just over 11,000 barrels of oil per day from the field in July.

Meanwhile, Iraqi lawmakers called for the resumption of oil exports through the Lebanese port at Tripoli following a visit to the region by the Lebanese premier.

Lebanese Prime Minister Fouad Siniora met with Iraqi Prime Minister Nouri al-Maliki this week to discuss bilateral ties and possible energy deals, including oil exports to Lebanon.

Ayad al-Samarai with the Sunni Accordance Front called on the government to expand activity in Tripoli through a jointly funded refinery project, Voices of Iraq reported.

"The visit of the Lebanese premier to Iraq would revive developing Iraq-Arab relations," he said.

Iraq broke off diplomatic relations with Syria, an export carrier, in the 1980s, halting any exports to Lebanon.

Infighting delays Iraqi oil contracts
Political infighting and security concerns in Iraq are delaying any significant development on deals with international oil companies, officials said.

Charles Ries, U.S. minister for economic affairs and coordinator for economic transition in Iraq, said short-term contracts to raise Iraqi oil production by 500,000 barrels per day probably would not go through because of the Iraqi political climate.

The Iraqi Oil Ministry said it wants to push development deals through by 2009, but concerns over the contracts and the lack of federal regulations over the oil sector have complicated those plans, The Financial Times said.

Security is plaguing the Iraqi oil sector as well. Royal Dutch Shell carries out the majority of its administrative duties elsewhere, advising Iraqi staff in northern Iraq from outside the country.

Exploration and development officials with the Italian oil firm Eni, however, have visited the region in hopes of securing long-term oil deals with Iraq.

Shell still interested in Iraqi contracts
Royal Dutch Shell said it was still in negotiations with Iraq on short-term service contracts despite claims by a top U.S. economic transition official there.

U.S. economic transition chief Charles Ries said Sunday the Iraqi government was considering dropping the contracts meant to bring more Iraqi oil to market. Royal Dutch Shell, however, said it was still talking with Baghdad on the deals, Business Intelligence Middle East said.

"Negotiations go on," Shell officials said.

Iraqi Oil Minister Hussain al-Shahristani said Baghdad was discouraged by the slow pace at which contracts had moved as the country told energy majors they should revise their proposals for one-year contracts instead of the initial two-year plans.

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Analysis: Oil prices hit U.S. military
Washington (UPI) Aug 21, 2008
Is $4-a-gallon gas putting a dent in your wallet? Just be glad you aren't paying the fuel bill for the military, the single largest energy user in the country.