OREANDA-NEWS. September 24, 2014. A revised contract signed last week by British oil major BP and China's CNPC for Iraq's Rumaila oilfield has raised both companies' stakes in a joint venture formed to develop the field, a senior Iraqi oil official said.

Under the revised contract, BP has cut the planned output target for the supergiant field to 2.1 million barrels per day from 2.85 million bpd and extended the life of the deal, BP and Iraqi officials said on Thursday. The original contract had BP holding a 38 percent stake in the Rumaila venture, while CNPC had a 37 percent share and Iraq's State Oil Marketing Organisation controlled the rest. According to the revised deal signed on Thursday, BP's share rose to 47.6 percent and CNPC's to 46.4 percent, while Iraq's stake was reduced to 6 percent, Thamer Ghadhban, top energy adviser to outgoing Prime Minister Nuri al-Maliki, told Reuters.

He did not elaborate. BP and CNPC could not immediately be reached for comment. After signing a series of service agreements with foreign companies in 2009-2010 to develop its giant southern oilfields, Iraq set an overall production capacity target of 12 million bpd by 2020, which would rival the output capacity of top oil exporter Saudi Arabia at 12.5 million bpd. Foreign oil companies working in Iraq include BP, leader at Rumaila; ExxonMobil, in charge of West Qurna 1; Royal Dutch Shell, operator of Majnoon; and Lukoil, which is leading West Qurna 2 operations.

But crumbling infrastructure, red tape and a lack of clear legislation have stunted investor interest. Baghdad has reduced its overall capacity target to 8.5-9 million bpd and returned to the negotiating table to discuss revised planned output targets, known as plateau production levels, with oil companies. "With major contracted fields' production plateaux reduced to more feasible and sustainable targets I'm now confident we can reach 9 million bpd or so by 2020," Ghadhban tweeted on Thursday. Rumaila has estimated reserves of 17 billion barrels. It currently produces around 1.3 million to 1.4 million bpd, almost half of Iraq's output of around 3.2 million bpd.