Iraq signs deal with Exxon to help develop large oilfield

Exxon Mobil signed an statement with Iraq connected Wednesday to assistance it make its elephantine Majnoon oilfield and grow lipid exports, authorities officials and sources said, marking the U.S. major's instrumentality to the state 2 years aft leaving.

The non-binding statement with Exxon, a U.S. major, follows a drawstring of deals with different lipid companies, including Chevron, BP and TotalEnergies, arsenic Iraq seeks to accelerate lipid and state accumulation by offering much generous terms.

Iraq holds immoderate of the world's largest lipid and state reserves and erstwhile aspired to rival Saudi Arabia with output of up to 12 cardinal barrels per day.

It presently produces astir 4 cardinal bpd and aims to transcend 6 cardinal bpd by 2029, though advancement has been hampered by reddish tape, corruption, infrastructure bottlenecks, years of struggle and sectarian tensions.

Majnoon, located 60 km (37 miles) from Basra successful confederate Iraq, is 1 of the biggest oilfields successful the satellite with an estimated 38 cardinal barrels successful place.

The statement reflects Iraqi officials' propulsion to modernize the country's vigor assemblage and amended relations with Washington, said Muwafaq Abbas, an lipid expert and a erstwhile crude operations manager astatine state-run Basra Oil Company.

"The deals transportation governmental weight, signaling Baghdad's intent to rebalance determination ties and deepen its integration with Western markets," Abbas said.

Iraqi Prime Minister Mohammed Shia al-Sudani announced the woody with Exxon connected Wednesday but did not supply details.

"We are pleased to person signed an HOA (Heads of Agreement) with the Iraqi Oil Ministry to measure exploration, improvement and lipid selling opportunities successful Iraq," an Exxon spokesperson said.

The statement volition impact a profit-sharing statement covering crude lipid and refined products and plans to upgrade Iraqi lipid export infrastructure successful the south, according to 4 sources with cognition of the matter.

Iraq's authorities lipid institution SOMO volition besides motion an statement with Exxon to unafraid retention capableness successful the Asian market, the sources said.

SOMO did not instantly respond to Reuters requests for comment.

SOMO could usage Exxon's retention successful Singapore, Iraqi authorities quality bureau INA reported successful September.

Exxon was 1 of the archetypal Western lipid firms to participate Iraq to make lipid fields aft the U.S. penetration successful 2003. But it near the West Qurna task owed to what sources described arsenic mediocre returns.

It besides tried to make fields successful Iraq's semi-autonomous portion of Kurdistan contempt Baghdad's ire but besides near those projects owed to what sources said were mediocre exploration results.

After exiting Iraq's elephantine West Qurna 1 oilfield, Exxon transferred its remaining involvement and operatorship to PetroChina, which became the pb contractor.

In September, Iraq’s national authorities reached an statement with the Kurdistan Regional Government (KRG) and planetary lipid companies to resume crude exports through Turkey that were suspended successful 2023.

That is expected to yet instrumentality up to 230,000 barrels per time to planetary markets astatine a clip erstwhile OPEC+ oil-producing countries are boosting output to summation marketplace share.