OAO Lukoil, which is Russian’s biggest non-state oil producer, is studying documents on Iraq’s West Qurna-1 oil field, which Exxon Mobil Corp. (XOM) may quit, as it considers extending developments in the Middle Eastern nation.
Lukoil will take a decision on probable participation in the project by the end of this year, billionaire Chief Executive Officer Vagit Alekperov said. The oil firm holds 75% of the separate phase 2 project at the field, called a ‘super giant’ by the Oil Ministry of Iraq.
Alekperov told to the media in Moscow that they are looking at the major issue now, that what economic synergies the company will get if these two projects work alongside.
Iraq is looking for international investment in its energy industry, while warning companies against signing deals with authorities in the northern Kurdish area without the approval of the central government. The nation this year asked companies like Exxon Mobil to discard oil exploration in the semi-autonomous region or exit projects in the south.
Iraq’s state-owned South Oil got a letter from Exxon, requesting for permission to share technical data about West Wurna-1 with BP Plc (BP/), Eni SpA (ENI) and Lukoil, Dhia Jaafar, South Oil’s director general stated this on 8 November. Lukoil told on the very next day about receiving a proposal from Exxon Mobil.
Exxon Mobil has 60 percent of the West Qurna-1 project after signing a deal in January 2010 to build up the field, according to the living, Texas-based company’s website. Oil Exploration Co. of Iraq holds 25 percent and Royal Dutch Shell Plc (RDSA) holds the rest 15 percent, according to the statement.
Lukoil and china National Petroleum Corp. were informed by Lukoil that it would favor their bids if they take decision to buy Exxon’s stake in the project. This was reported on November 6, citing unidentified officials of oil ministry.
Lukoil raised its stake in West Qurna-2 to 75 percent in this current year after buying about 19 percent from Statoil ASA. (STL). The Moscow-based oil producer is in search of a new parent in the project, deputy Vice-President Andrei Gaidamaka said on a conference call.
Source: [Business Week]