ONGC [Get Quote] Videsh, the overseas investment arm of state-owned Oil and Natural Gas Corporation, is one of 41 global oil corporations shortlisted by the Iraq government to develop its oil fields. Iraq has the world's largest proven oil reserves.

"We are confident of getting one block at the minimum," said a senior official with ONGC, India's largest oil and gas producer.

"There may be risks in Iraq, but you cannot afford not to be in that country's oil sector," he added.

Iraq plans to offer various short and long-term contracts to global oil companies through which it hopes to increase oil production to 4.5 million barrels per day (bpd) by 2013 from the current 2.5 million bpd, which is around 3 per cent of total world production.

China's Sinopec and CNPC are among the other short-listed companies.

US-based ExxonMobil, Royal Dutch Shell, British Petroleum and France's Total are among others that have already been given contracts to develop several of Iraq's oil fields.

Other Indian oil [Get Quote] companies such as Reliance Industries [Get Quote] did not apply for the shortlist after the Iraq government threatened to blacklist the Mukesh Ambani-promoted company for buying two oil blocks in Kurdistan in northern Iraq that were granted by a breakaway government that Iraq does not recognise.

OVL is also renegotiating earlier exploration commitments given under the Saddam Hussein regime and cancelled following the US invasion in 2003. One of these is the Tuba oilfields in northern Iraq, for which it had bid in consortium with Reliance and Algerian company Sonatrach.

The other block in which ONGC hopes to regain exploration rights is Block 8, located in southern Iraq.