Iraq red tape threat to key BP oilfield

The future of BP’s flagship Rumaila oilfield in southern Iraq is in jeopardy after a bureaucratic snarl-up in Baghdad forced the company to axe a hundred crucial contractor jobs.

The move highlights the mounting challenges facing western oil majors in Iraq, and bodes ill for the country’s ambitious plans to revive an oil industry still recovering from years of war and sanctions. Some oil majors are so disenchanted with the difficulties of doing business in Iraq that they are considering leaving the country for good.

Paolo Scaroni, chief executive of Italian oil group ENI, said this month that he had told the Baghdad government: “Either you remove the obstacles or we will remove ourselves from the country.”