Turkish Petroleum eyes Iraqi oil deal with Japan by year-end

TOKYO, Oct. 23 Kyodo - State-run Turkish Petroleum Corp. is seeking to ink a deal with Japanese companies to form a consortium by year-end to apply for the first round of bidding for contracts to develop vast oil fields in Iraq, the company's chairman, Mehmet Uysal, said Thursday.

During a visit to Japan this week, Uysal said he met with senior and executive
officials of three companies -- Mitsubishi Corp., Inpex Corp. and Japan
Petroleum Exploration Co. -- as well as government officials at the Ministry of
Economy, Trade and Industry to discuss the possibility of joint development of
Iraqi oil fields.
''We have to complete the consortium business, best before the end of 2008,''
Uysal said in an interview with Kyodo News, adding he received a ''very
positive'' response from the Japanese side.
''I believe the next meeting (with the Japanese companies) will take place
within about one month with a much more clear definition and terms of
agreement,'' he said.
The Turkish national petroleum company's proposal comes as Iraq is preparing
for oil contract bidding expected to be held around spring, the first bidding
since the collapse of the Saddam Hussein government in 2003.
With gradual improvements in security conditions in Iraq, international oil
companies are scrambling to participate in the bidding with the hope of
investing in the country's rich oil fields located in areas such as the
southern region of Basra.
The three Japanese companies have already passed a prequalification review by
the Iraqi government to join the round of bidding.
While the United States, Europe and China are all showing strong interest in
Iraqi oil fields, Uysal said he would prefer to form a partnership with
Japanese companies, citing the close bilateral relations between Turkey and
Japan, and the mutual benefits that the partnership could bring.
''Japanese companies have advanced technologies and financial capabilities,''
Uysal said.
''It's very difficult for them to go to Iraq and work in the fields. I can help
Japanese companies on the field side,'' he said.
The chairman also said that he has received three offers from Western companies
to form a consortium and has begun discussions with two other oil giants on the
matter.
Uysal said Turkey is becoming ''an energy hub,'' operating a pipeline in the
northern Iraqi city of Kirkuk. ''It's very easy for Iraqis to export their gas
to Europe via Turkey,'' he said. ''This advantage cannot be disregarded by the
international oil companies.''
A JAPEX spokesman confirmed that President Osamu Watanabe held a one-hour
meeting with Uysal on Wednesday and said they had discussed oil development in
Iraq but did not reach an agreement on any specific issue.
Meanwhile, officials at Mitsubishi and Inpex declined to confirm discussions
with Turkish Petroleum.
While the Japanese side has mostly been silent on working closely with Turkish
Petroleum in Iraq, Uysal expressed confidence that the two sides will reach an
agreement ''within a very short time.''
''Partnership possibility with Japanese companies is very high,'' Uysal said.
''What I put on the table about adding value is not easily rejectable for the
companies.''
==Kyodo