Oil companies reluctant to invest in Iraq

By JIM KRANE, Associated Press Writer
Thu Jul 6, 1:49 PM ET

DUBAI, United Arab Emirates - In Iraq's peaceful north, a trio of foreign oil companies have begun classic wildcat exploration, hoping a gusher of black gold will bring them untold wealth.

But the companies are little-known outside the industry — something that's unlikely to change until security improves. And the deals they have cut with the Kurdish regional administration bypassing the central government leaves them in a murky legal situation.

More than three years after the U.S.-led invasion, no big oil company has stepped forward to spend the huge sums necessary to tap Iraq's giant oil reserves and get crude flowing and revenues pouring into Iraq's government to help pay for food, jobs and even medical care.

"It will take a lot more to bring in the big guys," said Sharif Ghalib, a senior analyst with Energy Intelligence Research in New York.

None is likely to start prospecting until company chiefs feel reasonably assured that their workers won't be sent home in coffins and that their investments have legal protection that won't be taken away by a new government. >>>cont

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