THE residents of Shiwashok, a dusty village sprouting from the hard-scrabble landscape of Kurdistan in northern Iraq, have simple desires: drinking water; fuel for the electricity generator; a toilet for the primary school.

Sadi, the village chief, rattled off the wish list to Pradeep Kabra, an executive from Addax Petroleum who had flown in from Geneva to check on progress at the company’s Taq Taq oilfield.

“We’ll do whatever we can to help,” he said.

After covering the essentials, Sadi had one last, pressing request: a new volleyball court. The sport is hugely popular here and Shiwashok’s team are said to be the best of the surrounding villages. They have a game coming up and practising on an improvised mud patch is difficult. “We’ll look into it,” said Kabra.

For Addax, such quid pro quos are a small price to pay to operate in Iraq. The publicly listed oil group is one of only four foreign companies that are drilling in the country. It is a privileged position. Iraq sits atop a sea of 115 billion barrels of oil, the largest reserves in the world after Saudi Arabia and Iran; enough to produce for the next 126 years, according to Deutsche Bank.

Yet since the Iraqi government nationalised the industry in 1972, oil’s main players have been shut out. Years of war and violence have kept them at bay.

That may be about to change. In October the Baghdad government kicked off a round of bidding to allow international oil companies to exploit eight of the country’s largest oil and gasfields. BP, Royal Dutch Shell, Exxon Mobil and Gazprom are among the 35 companies that have put concerns about security to one side and thrown their hats in the ring. The deals would pave the way for the first significant foreign investment in the country’s biggest fields in more than three decades. Some side deals have already been signed — last month Shell announced a $4 billion (£2.7 billion) gas joint venture with the Iraqi government and opened a permanent office in the country.

For Iraq the timing couldn’t be better. As reserves dry up around the world and national governments tighten their grip on what is left, the industry is more desperate than ever to get its hands on the Iraqi honey-pot. The plummeting oil price, from a high of $147 a barrel this summer to a new low of $36 last week, has focused their minds.

Along with Saudi Arabia, Iraq is one of the cheapest countries to extract oil from, costing as little as $4-$5 per barrel thanks to the easy geology and high flow rates.

That is a long way from more exotic endeavours such as Canada’s tar sands, where extraction can cost $50 a barrel or more. Labour is also cheap. Addax, which has made $248m so far this year, pays $15 a day to the manual labourers who work at Taq Taq.

In terms of easily accessible and plentiful oil, Iraq is the final frontier. But if the experience of Addax and the other intrepid few who have ventured into Iraq is anything to go by, getting it out of the ground will be a long, tortuous process.

Security is a problem. Even in Kurdistan, a relatively tranquil region that was left largely unscathed by the recent war, foreign visitors have 24-hour armed protection and travel in armoured convoys. A suicide bomber in Kirkuk killed 46 people in a restaurant this month, while the Kirkuk-Ceyhan pipeline, the region’s main export route to Turkey, was shut twice in November after attacks by Kurdish rebels. Hotels and embassies in Erbil, the Kurdish capital, are surrounded by concrete blast walls and patrolled by guards wielding AK-47s.

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