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Exxon sold more than 50% stake on Iraqi West Qurna oilfield to PetroChina and Pertamina

Exxon sold more than 50% stake on Iraqi West Qurna oilfield to PetroChina and Pertamina
On this Friday, Iraq’s Oil Minister confirmed that the Exxon Mobil is selling over half of its 60 percent holding in Iraq's West Qurna-1 oilfield project to China's biggest energy firm PetroChina and Indonesia's Pertamina.
Abdul Kareem Luaibi, Minister of Oil of Iraq, stated, "25 percent (stake) to PetroChina and 10 percent to Pertamina." According to the company and industry sources, it has been unleashed that China and Indonesia are all set to join ExxonMobil to carry out the development projects within the country. The project costs around 50 billion USD, as per the data of the same sources.
U.S. oil major Exxon Mobil is the operator of the giant oilfield and last year had offered to sell its entire stake after a dispute with Baghdad over contracts it signed with autonomous Kurdistan, deals which the central government rejects as illegal.
The company later had committed that it will make some more investments in the particular oilfield. It is producing around 500,000 barrels a day in this oilfield. Luaibi added that the deal would be done "maybe after two to three weeks".
To comment on this, PetroChina could not be reached immediately. However the company has already confirmed that it is in talks with the Exxon Mobil in terms of buying stakes in the West Qurna-1 oilfield of Iraq. Indonesia's chief economic minister Hatta Rajasa said in March that Pertamina was negotiating a 10 to 20 percent stake.
According to the industrial sources, a final agreement is contingent on getting better terms for its technical service contract at West Qurna-1. Baghdad has offered to sweeten the deal, the sources say, though there are no details.
Tough terms and slim margins on Iraq's service fee contracts are drawbacks to investment in southern Iraq. However, it can be hoped that in future terms will be made more flexible so that operators in the oilfield can work freely and can deliver output as per their core competency level.
Updated 25 Aug 2013 | Soruce: Reuters | By S.Seal
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