Lukoil intends to divest its stake in West Qurna 2 to Chinese companies, while BP considers exiting Rumaila field

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Lukoil owns a 75% stake in the southern West Qurna 2 field. (Credit: John R Perry from Pixabay)

British oil and gas company BP and Russia’s Lukoil are looking to sell their assets in Iraq, due to lack of proper investment environment.

The announcement was made by the country’s oil minister Ihsan Abdul Jabbar.

The minister said that Lukoil has sent a formal notification, expressing its intention to divest its stake in West Qurna 2 to Chinese companies.

Currently, the Russian oil and gas company owns a 75% stake in the southern West Qurna 2 field, while the remaining stake in held by state-owned North Oil.

The minister was quoted by Bloomberg as saying: “The existing investment environment in Iraq is inappropriate to keep the major investors.

“All major investors are either looking for another market or for another partner. We, as an investment environment, are inappropriate for major partners.”

According to , BP wants to quit the giant Rumaila field, where it holds 38% stake. The other partners in the field include CNPC with a 37% stake, state-owned Basrah Oil, and the State Oil Marketing Organization.

With a production capacity of about 1.5 million barrels per day (b/d), the southern field of Rumaila is considered as the country’s biggest. It is estimated hold 17 billion barrels of recoverable oil, S&P Global Platts reported.

The minister also added that Exxon Mobil intends to sell its stake in West Qurna-1 for a “very cheap” prices of no more than $400m.

In April, the Iraqi News Agency (INA) reported that US oil and gas major ExxonMobil is looking to sell its stake of 32.7% in Iraq’s West Qurna-1 oil field, as part of its efforts to reduce its debt.

Located in the southern part of Iraq, the West Qurna-1 field is one of the world’s largest fields, with a 500,000 b/d capacity.

Operated by ExxonMobil, the field is estimated to contain recoverable reserves of more than 20 billion barrels.