Iraq has awarded a new exploration and development license to Britain's Mesopotamia Petroleum.

The company has just finalised a new $400 million (£277 million) contract to begin drilling in the country, a development which prompted British foreign minister David Miliband to declare Iraq "open for business".

"With the improving security situation... our relationship becomes one defined not just by defence and security but also by politics, by economics, by culture and by education," he told a press conference during a surprise visit to the country.

The joint venture will involve the purchasing of 12 new rigs to significantly increase the country's overall drilling operations, while Mesopotamia will be on hand with expert engineering and logistical support for the new project.

The Iraq Oil Services Company, which awarded the license, has also pledged a commitment to expand the skills of the domestic workforce in order to service the rigs.

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