LARGE RESERVES Violence in Iraq has ebbed sharply, and major oil companies like BP and Exxon have

already signed large deals to develop oilfields in the south, where current average exports are 2.13 million barrels per day and .output 2.35 million bpd But companies entering new deals must weigh risks from Iraq's continued political instability against the potential gas and crude developments on offer in the bidding, which are mostly in remote parts .of western and central Iraq Oil explorers winning blocks will immediately be able to extract gas discovered at their sites, but the Iraqi government has retained the option to pay compensation to companies to keep crude in the ground .to help boost its reserves Investors may also shy away from blocks in more remote areas due to concerns over security in a country where Sunni Islamists tied to al .Qaeda are still active Another hurdle could be the failure of Iraq's parliament to pass a longdelayed national oil and gas law that would provide a stronger .framework for protecting oil investments Baghdad's central government and the autonomous Kurdistan Regional Government in the north are also locked in a dispute for control over oil in areas which both authorities claim. Baghdad rejects deals signed by .the Kurdish region as illegal Exxon Mobil was dropped from the fourth bidding round after it announced deals to develop oilfields in Kurdistan, a move Baghdad rejected. U.S.-based Hess Corp was also blocked from competing after it .signed for Kurdish oil deals