IRAQ and China have agreed the terms of a US$3 billion oil service contract, Iraq's oil minister said yesterday, announcing the first major oil contract with a foreign firm since the fall of Saddam Hussein.

    China has beaten international oil majors to take the first opening since the US-led invasion for work on the world's third-largest reserves. Iraqi Oil Minister Hussain al-Shahristani warned that time was running out for big Western oil firms, which have jostled for years for Iraqi contracts, to seal even the short-term deals that were expected to mark their return to the country. Iraq and China's state-oil firm CNPC have agreed the renegotiated terms of an old deal signed in 1997 to pump oil from the Adhab oilfield, Shahristani told Reuters in an interview.