Ramco Energy of Aberdeen explained Friday that the deal it agreed this week to form a joint venture with the state-owned Iraqi Drilling Co. is worth $400 million in joint investments in new drilling rigs and other capital.

The deal is the Iraqi Ministry of Oil's first joint venture agreement of its type with a foreign company since the fall of the regime of Saddam Hussein in 2003. Signatures on Friday in Baghdad created the joint venture Iraqi Oil Services Co. ,or IOSCO, a 51-49-percent deal between Ramco’s Iraqi entity Mesopotamia Petroleum Co. and IDC.

Ramco, which owns about a third of Mesopotamia, saw its shares up over eight percent early Friday.

The deal was deemed significant in London, and Foreign Secretary David Miliband was compelled to issue comment: “This is an important signal of the long-term commitment the United Kingdom has to Iraq in terms of trade, commerce and economic co-operation,” he stated, adding, “It is also an important message to British business that Iraq is open for business."

The joint venture sees “a large number of new wells” significantly increasing oil and gas production in the Republic of Iraq. Some 12 drill rigs are intially sought. Judging by a communique to shareholders, state-owned oil companies are seen as first clients of the new company.

Mesopotamia will, it said, focus on management and training.

Meanwhile, “major equity fundraising”is planned for which London-based investment bank JPMorgan Cazenove has been appointed.

Tags: Iraq Drilling Company, Ramco Energy