But Iraq has accepted an Egyptian offer to forgive $800mn in debt, Iraqi Finance Minister Bayan Jabor said on Thursday and three eastern European countries have offered an 80% writedown of debt owed to them.

Iraq has been struggling for years to reduce its massive debt burden, much of it money borrowed to finance the 1980-88 war with Iran.

When Saudi Arabia announced last month that it was writing off 80% of the more than $15bn it was owed by Iraq, Jabor estimated his country’s debt at $140bn.

Jabor, in the Red Sea resort of Sharm el-Sheikh on Thursday for an international conference on Iraqi stability and reconstruction, said Iraq’s creditors were all keen to gain access to its oil wealth, but the nation could not agree to such a link.

“The Russians are hesitant. They want investment in the Rumaila oilfield in return for eliminating the debt,” Jabor said.

Moscow has forgiven Iraq much of the debt it owes, but not the entirety.

The world’s top oil companies have been manoeuvring to win a stake in oilfields in Iraq, which holds the world’s third biggest reserves.

They are awaiting passage of its oil law, expected within weeks, but would also require a fundamental return of law and order. The North and South Rumaila oilfields in the south make up the bulk of Iraq’s crude exports, which run at about 1.5mn barrels per day (bpd).

Iraq’s oilfields are suffering from decades of wars and sanctions, but the Rumaila fields could sustain production of around 1mn barrels per day with the help of foreign investment, analysts said.

Russia’s top oil producer Lukoil also wants to revive a deal for the 600,000 bpd West Qurna oilfield that was scrapped by the government of Saddam Hussain at the end of 2002.

Jabor said Egypt has agreed to forgive all Iraqi debts to Cairo, amounting to $800mn.

He said Slovenia, Bulgaria and Poland would agree to forgive 80% of Iraqi debt but did not say how much that would be.

James Dobbins, an analyst at the Rand Corp, said debt relief was of secondary importance because the Iraqis were not paying off the money they owed anyway.

“It is a purely paper transaction. It’s symbolic but it doesn’t have any immediate effect,” he said.

Saudi Foreign Minister Prince Saud al-Faisal said at the opening session of the conference that the details of the promised Saudi debt writedown were still under discussion.

“(Saudi Arabia) has submitted all the information it possesses to the Iraqi side, and the matter is still at the discussion stage ... to reach an appropriate settlement. Our treatment of the question ... will be in accordance with the guidelines (of) the Paris Club,” he added.

PIN/REUTERS