Petro China assumes control of West Qurna 1 oilfield as ExxonMobil completes legal exit
ExxonMobil has officially departed from the West Qurna 1 oilfield in southern Iraq, paving the way for PetroChina to take over operations as the primary contractor.
This transition was marked by a meeting in Basra on Monday, where senior Iraqi oil officials engaged with representatives from ExxonMobil, PetroChina, and Basra Oil Company (BOC), according to statements made by a deputy oil minister.
The process began in November when ExxonMobil signed a settlement deal, facilitating PetroChina’s transition into the role of the primary contractor. The Deputy Director of BOC, Hassan Mohammed, emphasized that after careful evaluation, the Iraqi Oil Ministry and BOC concluded that PetroChina was the optimal choice for this crucial position.
Upon ExxonMobil’s departure, PetroChina will emerge as the majority stakeholder in the West Qurna 1 oilfield. To facilitate the acquisition, Iraq has entered into a sale agreement, managed by BOC, which outlines the financial aspects of acquiring ExxonMobil’s share. This agreement also addresses the tax implications, with negotiations planned for the finalization of the amount ExxonMobil should pay for selling its share.
In the event that the tax matter remains unresolved, the BOC Deputy Director outlined two alternatives: reaching a settlement or resorting to arbitration. Last year, Pertamina, Indonesia’s state-owned oil and gas company, acquired 10 percent of ExxonMobil’s share, bringing its total ownership to 20 percent. Simultaneously, BOC acquired 22.7 percent of the oilfield.
The West Qurna field, boasting 43 billion barrels of recoverable reserves, stands as one of the largest oil fields globally. The Iraqi government had previously approved the sale of ExxonMobil’s share to BOC in 2022, with the transaction valued at $350 million.
