17 Jan, 2010, Baghdad, Iraq

On Sunday, Iraq gave a final approval to a deal by a Shell-led consortium for developing one of its largest oil fields, marking the crucial step towards the nations postwar. Royal Dutch Shell PLC and its partner, Malaysia’s state-run Petronas have won a right to develop the 12.5 billion barrel Majnoon field during the Iraq’s second postwar bidding round. Shell and Petronas will pay the Iraqi government a $150-million (U.S.) signing bonus as part of the deal.

At a Baghdad signing ceremony, the Oil Minister Hussain al-Shahristani hailed the deal as a major step to transform the region from an area of misery and deprivation into a prosperous one. The oil deal for Majnoon that is located in Basra province near the Iranian border was one of the seven that the Iraqi government awarded in the last month.

The Majnoon field was discovered in 1976 and was partially developed until the Iran-Iraq war halted work there in the early 1980s. The Oil production was resumed in year 2002.

The oil deals mark a crucial step forward in the country’s so-far faltering bid to raise oil output for Iraq. On Monday, the Iraqi government would give a final approval to contract to develop the Gharraf field in the southern Nasiriyah province that holds 863 million barrels of oil.