April 10, 2008 / 9:40 AM / 11 years ago

UPDATE 1-Total says Iraq service contracts near deal

(Recasts with details)

PARIS, April 10 (Reuters) - Total’s (TOTF.PA) discussions for a contract in Iraq’s energy sector are being finalised, the head of the oil major said on Thursday, also saying that the French group was looking at investors in the Gulf region.

“I know discussions are being finalised, but I don’t have a date for an announcement. This is up to the Iraqi authorities,” Total Chief Executive Christophe de Margerie said on the sidelines of an oil summit in Paris.

“These are contract services. This is necessarily a transitory stage, not a proper way to work over the long term,” he said, confirming, confirming Total was negotiating for the development of the West Qurna field along with U.S. group Chevron (CVX.N).

Earlier this month, an Iraqi government advisor told Reuters that Baghdad would pay as much as $2.5 billion to five oil companies to increase the country’s oil output by nearly a quarter.

BP (BP.L), Royal Dutch Shell (RDSa.L) and Exxon Mobil (XOM.N) are also said to be close to signing two-year technical support contracts, which will give international companies a head start in their efforts to bid for future oil contracts.

Baghdad is expected to announce the list of qualified companies this month.

Asked about news last week that a state-owned Chinese investment fund had been buying shares in Total in recent months, de Margerie said he was “happy” with the move, which he said was not linked to a project in China.

He said he hoped funds from other countries where Total is active, in particular Gulf countries, would invest in the French group.

“We have a strategy to diversify our shareholder base. We would like funds to come from countries where we have long-term relationships. This is why, besides China, we would like to have equivalent partnerships coming from certain Gulf countries.” (Reporting by Marie Maitre)

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