Page 4 - MEOG Week 21 2021

MEOG COMMENTARY MEOG

Intrigue in Iraq as deals

progress (or don’t)

Oil and gas deals in Iraq are changing shape as

politics, progress and pragmatism all converge.

IRAQ REPORTS from Iraq suggest that there have should be considered under new terms and con-
been twists in the tale for two recent major devel- ditions,” it said.
opments in the country’s oil and gas sector. The news follows comments earlier in the
WHAT: Despite Baghdad’s apparent acquiescence to month by BOC director-general Khalid Hamza
Iraq is reported to have ExxonMobil’s efforts to sell its stake in the West Abbas, who said that BOC had asked to buy Exx-
rejected ExxonMobil’s Qurna-1 (WQ-1) oilfield development project, on’s stake, noting that the company had valued its
proposal to sell its stake it now appears to be blocking the US firm’s pro- share of the remaining nine years of the 20-year
in West Qurna-1 to two posed sale to two Chinese companies to instigate technical services contract (TSC) signed in 2010
Chinese firms. the transfer of the stake to a local state firm. at $350mn, with the full 100% at $1.07bn.
Meanwhile, long-discussed plans for This followed a statement in which he said
WHY: Saudi involvement in Iraq’s oil and gas sector BOC had “hoped that Chevron would buy
Basra Oil Co. had wanted have come a step closer to fruition, with a lit- Exxon’s share and be the replacement, but it
the stake to go to another tle-known firm tipped to partner on a major gas seems that they didn’t have the desire to be the
US firm, but now appears development. replacement. [The Ministry of Oil (MoO)] told
determined to acquire it us officially, with an official letter, referring to the
on favourable terms. WQ-1 contractual text … that ExxonMobil [is proceed-
Earlier this month, state-owned Basra Oil ing towards] selling its share to a coalition of the
WHAT NEXT: Co. (BOC) informed ExxonMobil that it had two companies, PetroChina and CNOOC.”
A little-known Saudi rejected the proposed sale of the super-major’s He added: “We have no objection either [to]
company is believed to 32.7% stake in WQ-1 to China National Petro- PetroChina or CNOOC, they are our partners
be in talks to develop leum Corp. (CNPC) and China National Off- already,” though this no longer appears to be the
Iraq’s largest non- shore Oil Co. (CNOOC). case, while the naming of PetroChina also looks
associated gas field Iraq Oil Report authenticated a letter with to have been inaccurate.
alongside Schlumberger Iraqi officials in which BOC said: “We’d like to In its coverage, Iraq Oil Report noted that
as Baghdad seeks to let you know that we don’t agree with the terms Exxon was “unlikely to relinquish an asset for
increase the availability you’ve agreed to with the two companies.” free when it has already lined up a qualified
of gas. The state company added that it would not buyer”, adding that “given the company’s history
match the terms agreed with the Chinese firms. of aggressive legal action to defend the sanctity of
“If BOC wants to buy your contract share, this its contracts around the world, the stage appears

P4 www. NEWSBASE .com Week 21 26•May•2021