BAGHDAD, April 1 (Reuters) - Iraq plans to award oil and gasexploration and development contracts in 11 new blocks on April15, oil ministry spokesman Asim Jihad said on Sunday.
Iraq had initially set June 21 as the date to open the bidsfor the new blocks, located in border areas with Iran andKuwait, and in offshore Gulf waters.
Bidding documents will be made available to oil companiesplanning to make offers on April 13, Jihad told Reuters. Theoffers will have to be submitted on April 15 and the winnerswill be announced the same day, he added.
The oil ministry announced on Thursday measures to reducethe fees received by the oil companies from the government inthe new contracts.
The new contracts will exclude oil by-products from thecompanies' revenues, establish a linkage between prevailing oilprices and their remuneration, and introduce a royalty element.
Oil producers in Iraq currently receive a fee from thegovernment linked to production increases, which include crudeand oil by-products such as liquefied petroleum gas and dry gas.
OPEC's second largest producer, after Saudi Arabia, Iraqdecided to change the contracts after a glut caused oil pricesto crash in 2014, reducing Baghdad's ability to pay the fees.
Companies including BP, Exxon Mobil, Eni, Total and Royal Dutch Shell helpedIraq grow its production in the past decade by over 2.5 millionbarrels per day (bpd) to about 4.7 million bpd.
The semi-autonomous Kurdistan Regional Government producesoil and gas from fields under its control in northern Iraq undera production sharing model more profitable to companies.
The new contracts offered by Baghdad will also set a timelimit for companies to end gas flaring from oil fields theydevelop on territory under its control.
Iraq continues to flare some of the gas extracted alongsidecrude oil at its fields because it lacks the facilities toprocess it into fuel for local consumption or exports.
Iraq hopes to end gas flaring by 2021, which costs nearly$2.5 billion in lost revenue for the government and would besufficient to meet most of its unmet needs for gas-based powergeneration, according to the World Bank.(Reporting by Maher Chmaytelli; Editing by Mark Potter)
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