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China is welcome to explore oil resources in Iraq as a new law is set to open its oilfields to international companies, the Iraqi ambassador to China said yesterday.

"We encourage Chinese enterprises to join the multinational competition for exploration of Iraqi oilfields," said Mohammad Sabir Ismail.

The oil and gas law faces a parliamentary vote next month after Iraqi Prime Minister Nouri al-Maliki endorsed it in February and the Cabinet approved it the following month.

If ratified, it will open the country's oil resources to foreign companies; and a frozen Sino-Iraqi oil contract could be reactivated, he said.

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The 1997 deal to explore the Al-Ahdab field, worth $1.2 billion, was signed by China National Petroleum Corp and Baghdad when Saddam Hussein was in power.

Under the terms of the new law, all energy contracts signed by foreign producers during the Saddam era must be renegotiated.

"The revival of the deal is in the process and the two sides have established working groups to help the contract go forward," he said.

Ismail said Iraq's ambition is to exploit about 80 new oilfields in the coming years and produce 6.5 million barrels of oil per day by 2015.

It produced 2.6 million barrels a day before the 2003 US-led invasion. Production is about 2 million barrels a day at present.

The ambassador made the remarks on the eve of Iraqi President Jalal Talabani's week-long state visit to China starting tomorrow.