U.S. supermajor ExxonMobil has approached Iraq’s Oil Ministry to express interest in buying Lukoil’s 75% stake in the West Qurna 2 oilfield, one of the largest in Iraq, Reuters reported on Tuesday, citing multiple official Iraqi sources.
Lukoil’s international assets are up for grabs after the U.S. Treasury sanctioned in October the second-largest Russian oil producer alongside the top producer, state-controlled Rosneft, to force the Kremlin to sit down for genuine talks about ending the war in Ukraine.
Lukoil has a 75% equity stake in Iraq’s giant West Qurna-2 oilfield, which produces more than 400,000 barrels per day (bpd) of crude oil.
Following the sanctions, Lukoil declared in early November force majeure at West Qurna-2, while Iraq’s state oil marketing company SOMO canceled crude loadings from Lukoil.
Shortly after the sanctions were announced, Lukoil said it would sell all of its international assets, and reached a preliminary agreement with Switzerland-based commodity trader Gunvor to sell these.
However, Gunvor pulled the $22-billion bid for Lukoil’s international business after the U.S. Treasury Department signaled it was not happy with the deal, calling the company a Russian “puppet”.
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“President Trump has been clear that the war must end immediately. As long as Putin continues the senseless killings, the Kremlin’s puppet, Gunvor, will never get a license to operate and profit,” the U.S. Treasury said in an X post.
Iraq, meanwhile, has quietly stepped in to keep one of its most important oilfields from wobbling. After two months of unpaid wages at West Qurna 2, Baghdad has begun paying local staff directly, advancing December salaries to prevent a slowdown at a field that supplies roughly 0.5% of global oil and nearly a tenth of Iraq’s output—production that Iraq cannot replace from elsewhere.
Exxon is among the potential suitors for part of Lukoil’s international assets, as are Chevron, Carlyle, and International Holding Company (IHC) of Abu Dhabi, according to various media reports of the past weeks.
By Tsvetana Paraskova for Oilprice.com
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