PetroChina to buy 25% stake in Exxon’s West Qurna 1 Iraq field

11/28/2013

PetroChina to buy 25% stake in Exxon’s West Qurna 1 Iraq field

BY AIBING GUO, BENJAMIN HAAS & KHALID AL-ANSARY

BEIJING (Bloomberg) -- PetroChina, will sign an agreement with Exxon Mobil to buy a 25 % stake in Iraq’s West Qurna 1 field, Deputy Prime Minister for Energy Affairs Hussain al Shahristani said in an e-mail.

Exxon owns 60 % stake in the West Qurna field in Southeastern Iraq. The world’s biggest oil company by market value estimated the field will produce as much as 600,000 bopd by the end of 2013.

Iraq has asked Exxon to either develop projects in the semi-autonomous Kurdish region in the north, or exit projects in the south. The company made a “serious error” by signing a contract to explore for oil in the Kurdish region without the approval of the central government, Shahristani said in a September interview. Therefore, Iraq is demanding that Exxon and other foreign companies quit their business in fields controlled by the central government, he said.

The Exxon asset is near the Rumaila field run by BP and China Petroleum and Chemical Corporation, PetroChina’s parent. CNPC produces about 1.65 MMbopd from Iraqi projects, the company said last October.

Iraq, home to the world’s fifth-largest crude reserves, is producing 3.3 MMbpd and in August exported 2.58 MMbpd, Shahristani said in the September interview. Output will increase by 400,000 bpd by year-end and will exceed 5 MMbpd within three years, he said. Export capacity will exceed 6 MMbpd once four offshore plants are operating next year and terminals in the south are upgraded, he said.

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