Iraq's INOC to take over ExxonMobil's stake in West Qurna 1 oil field: minister

The Iraqi National Oil Co. will acquire ExxonMobil's stake in the West Qurna 1 oil field, following the government's approval of the takeover, oil minister Ihsan Ismaael said in a statement Jan. 5, as the revived state-owned company takes on holdings in new projects.

The minister didn't provide any further details.

ExxonMobil had filed last year an arbitration case against Iraq's state-owned Basra Oil Company over the US oil major's stalled attempt to sell its stake in the giant West Qurna 1 oil field. ExxonMobil couldn't immediately be reached for comment on the matter Jan. 5.

The main operator of the field, ExxonMobil entered into an agreement with third parties in January 2021 to sell its 32.7% share, a company spokesperson told S&P Global Platts in July. But Iraq's oil minister said May 3 that the country was seeking to take over the stake itself, after having previously said that it was in talks with unnamed US energy companies to acquire ExxonMobil's share.

Other partners in West Qurna 1 are PetroChina (32.7%), Japan's Itochu (19.6%), Indonesia's Pertamina (10%) and Iraq's Oil Exploration Co. (5%).

In 2010, Iraq awarded the contract to develop West Qurna 1 to ExxonMobil, Shell and Oil Exploration Co., and in 2013 ExxonMobil sold stakes to Pertamina and PetroChina. In 2018, Shell sold its 19.6% stake to Itochu and also exited the giant Majnoon oil field.

ExxonMobil's exit from West Qurna 1 may be similar to Shell's 2018 divestment of its stake in Majnoon, whose operations are now managed by Basra Oil Co., Ismaael said May 3.

ExxonMobil's attempt to wind down its stake in West Qurna 1 would follow its divestment in 2021 of its 32% interest in the Baeshiqa license in Iraq's semi-autonomous Kurdistan region.

Iraq said in June it plans to boost the production capacity of West Qurna 1 by 40% to more than 700,000 b/d over the next five years. Project partners have said that the field has recoverable reserves of over 20 billion barrels.