South Korea's KOGAS plans to make a $6.5bn investment in the development of the Zubair oil field, which contains 4 billion barrels of oil.
A consortium led by Italy's Eni, and includes KOGAS and US-based Occidental Petroleum, will develop the project in the south of Iraq.
The consortium was awarded the right to develop the project last year after Iraq organised its first auction of oilfield contracts since the US invasion in 2003.
The Zubair field is expected to raise its production capacity from 195,000bpd to 1.2 million bpd.
The deal is part of South Korea's initiative to invest $12bn in overseas energy and resources to provide fuel for its economy and ensure a stable and secure energy supply.