BAGHDAD, Dec. 22 (Xinhua) -- Iraqi Oil Ministry signed on Tuesday a preliminary contract with a consortium led by China National Petroleum Corporation (CNPC) to develop the Halfaya oil field in southern Iraq.

    The group, which also includes Malaysia's Petronas and France's Total, will develop the Halfaya oil field to produce 535,000 barrels per day (bpd) from its proven reserves of 4.098 billion barrels of oil.

    The group will be paid a remuneration fee of 1.40 U.S. dollars per barrel, according to the deal.

    The CNPC owns a 50 percent of the venture, while Total and Petronas each have 25 percent.

    The Chinese-led companies won the right to develop the oil field during the latest auction on Dec. 11-12, which awarded seven contracts to international oil firms.

    More than 40 world oil companies from 23 countries have participated in the auction, seeking investment in 10 Iraqi oil fields in the country's second round of bidding since 2003.

    The first auction round was held in June this year, in which the CNPC joined hands with Britain's BP to win the Rumaila oilfield service contract, also located in southern Iraq.

    Iraq is aiming to increase its crude oil output capacity, currently at roughly 2.5 million bpd, to 12 million bpd in six or seven years.

    Estimated at 115 billion barrels, Iraq holds the world's third largest proven oil reserves, only after Saudi Arabia and Iran.