US oil major Exxon, owner of the leading lubricant brand Mobil, recently signed a non-binding agreement with Iraq to assist in development of the Majnoon oilfield. This would help the Arab nation grow its oil exports, and the new agreement marks Exxon’s return to Iraq after a two-year hiatus.
Iraq has recently made several deals with other key players in the oil industry in its efforts to expand gas and oil production. These include Chevron, TotalEnergies and BP. The country currently has some of the largest gas and oil reserves in the world and aims to rival neighbouring nation Saudi Arabia across the border with an output of up to 12 million barrels per day (bpd).
At present, Iraq produces approximately four million bpd but seeks to exceed six million by the year 2029. To date, progress has been severely hampered by corruption, bottlenecks in infrastructure, red tape and years of sectarian tension and conflict.
The massive Majnoon oilfield is based in Southern Iraq, 60 kilometres from Basra. It is considered one of the world’s largest oilfields, with an estimated holding potential of 38 billion barrels.
According to former operations manager for the state-owned Basra Oil Company, oil analyst Muwafaq Abbas, the recent agreement represents Iraqi officials looking to modernise the nation’s energy sector and better its relations with the US. He added:
“The deals carry political weight, signalling Baghdad’s intent to rebalance regional ties and deepen its integration with Western markets.”
The new agreement with Exxon was officially announced on October 8 by Mohammed Shia al-Sudani, the Iraqi Prime Minister.
