Immense and untapped: Iraq’s oil

Iraq has a vast and untapped oil wealth, perhaps 100 billion barrels worth. That’s enough, industry experts say, to boost world oil supplies and trigger a decline in prices.

Government officials hope to increase output from an average two million barrels a day to an average six million barrels over the next four to six years.
Industry giants from Shell to Chevron are lining up to invest in Iraq’s potentially lucrative oil sector, but their involvement depends on a number of factors: a stable security situation, sound Iraqi oil legislation, and significant investment in infrastructure.

It’s a hefty checklist for a country that’s split along sectarian lines and is struggling to grapple with an active insurgency.

And even if that checklist is completed, Robert Powell, an analyst at the Economist Intelligence Unit, says progress in Iraq’s oil industry is likely to be incremental.

“Once international money and expertise start coming in, then you’ll find increases in oil production elsewhere,” Powell says.

“But it will be a slow and gradual increase, to levels that are not especially spectacular compared with [Iraq’s] potential.”

CNN