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Bond Market News
Iraq to Buy Exxon’s Stake in Oilfield for $350mn
May 11, 2021
Iraq is set to acquire the share of one of Iraq’s biggest oil fields, West Qurna 1 from ExxonMobil for $350mn. The US-based energy giant had been looking to sell its 32.7% stake in the oilfield, which is a shift in its 2019 stance when it was considering an injection of $53bn to boost Iraq’s oil projects. In case the deal goes through, Iraq’s Basra Oil Company would coordinate with other stakeholders to ensure smooth operations. Petrochina is the other large stakeholder with a 32.7% share in the oilfield. Japan’s Itochu Corp, Indonesia’s Pertamina and state-run Oil Exploration Company hold 19.6%, 10% and 5% respectively. Iraq is highly dependent on the oil revenues that constitute 95% of its income. It has approved 2021 investment budgets of ~$7bn presented by international oil companies and plans to increase light production as the oil market is seen to be recovering from the impact of the pandemic. Basra Oil Company director Khalid Hamza said, “A decision has been made and we sent a formal letter to ExxonMobil asking to buy its share”.
Iraq’s 5.8% 2028s traded 0.1 point higher to 96.875 yielding 7%.
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