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Iraq's oil ministry has postponed its latest exploration licensing round to April 25, giving international oil companies 10 days to study the proposed model contracts.

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The petroleum contracts and licensing directorate sent the final tender document outlining the bidding process and model for two proposed contracts to the companies on Friday, the oil ministry said Saturday.

The bid round, the country's fifth, includes 11 areas along the borders with Iraq and Kuwait and one offshore block in the Persian Gulf. Progress has been delayed over what contract model the government will use. Some of the oil companies have previously complained over the commercial framework on offer, despite the "unequaled geological prospects" under the ground in the blocks.

Originally planned for May 7, oil ministry officials had been planning to delay the bid round to July due to the country's upcoming national and provincial elections, scheduled for April and May. Oil company executives voiced their complaints over the previous April 15 deadline, saying they did not have time to prepare for the bid round. The oil ministry listed 16 international oil companies that have announced their intention to participate in the bid round out of 26 prequalified in January to take part.



Previous bidding rounds used technical service agreements, with specific contract models covering costs, and paid a remuneration fee for production. Some oil companies complained that the contract had too low a return on investment and was further marred by delayed payments and contract approvals.

The key changes under the new contract include cost recovery, which will be linked to oil prices. The payments for costs and profits will also be made in crude, rather than cash. The oil companies will also bid for a share of the block's revenue, rather than remuneration fees, as under previous bid rounds.

These were changed to reflect comments made by members of the Iraqi parliament and oil ministry, aimed at reducing development costs and to align the contract with oil market conditions.

--Adal Mirza, adal.mirza@spglobal.com

--Edited by Jason Lindquist, newsdesk@spglobal.com