A consortium consisting of BP and China National Petroleum Corporation (CNPC) has secured a contract for Iraq’s Rumaila oil field development.

Following a bidding round in Iraq yesterday, the consortium is looking for $3.99 remuneration for each extra barrel of oil produced.

But following discussions yesterday, the consortium accepted the oil ministry’s proposal of $2 a barrel. The companies have submitted tenders to raise production in Rumaila to 2.8 million barrels per day.

The Rumaila oil field is now pumping 1.1 million barrels per day and reserves are estimated at about 17 billion barrels.

The BP-led group beat a bid from Exxon Mobil Corporation and Petroliam Nasional Berhad (Petronas) after improving their offer, a spokesman for the oil ministry said during Iraq’s first licensing round in Baghdad.

Iraq had given the two groups time to improve their bids to expand the Rumaila field after neither offer met the government’s minimum requirements.