China, Indonesia to Join Exxon at Giant Iraqi Oilfield

China and Indonesia are set to join Exxon Mobil’s $50 billion project to develop Iraq’s West Qurna-1 oilfield, company and industry sources said on Aug. 22. Various scenarios for farming out Exxon’s 60 percent stake in the giant oilfield are still under discussion, but at this stage China’s biggest energy firm PetroChina is expected to take 25 percent and Indonesia’s state-owned Pertamina 10 percent, the same sources said. Exxon would remain operator of the southern field, core to Iraq’s oil expansion plans, though its share could be cut to 25 percent. Royal Dutch Shell would retain its existing 15 percent share.
China is already the top foreign player in Iraq’s oilfields and such a big stake in West Qurna-1, around 50 km northwest of the southern oil hub of Basra, would make PetroChina the single biggest foreign investor in Iraqi oil. PetroChina confirmed it was in talks for a stake in West Qurna-1 at its interim results briefing in August, though its president, Wang Dongjin, did not disclose the size. “The negotiation is still under way,” he told reporters. “We are likely to conclude the talks within this year.” For Pertamina, the deal could be its largest foreign acquisition and mark its first move into Iraqi oil and gas since U.S.-led forces toppled leader Saddam Hussein in 2003. UK drilling contractor KCA Deutag reported recently that it has signed two “significant” contracts valued at more than $165 million.
The first contract is a new five-year operations and maintenance program for platforms offshore Angola, with mutually-agreeable options to extend the duration of this contract. KCA Deutag said that in keeping with its history of utilizing local talent, 70 percent of the crew for this project will be Angolan nationals.
The second award is a 30-month extension to an existing drilling and maintenance services contract for a platform in Norway. KCA Deutag President of Offshore Run Lorentzen commented in a company statement:
“To be awarded two contracts in these core markets is an excellent result for KCA Deutag.  We have an undeniably strong reputation working in these offshore regions, and these contracts will only serve to enhance this even further.  Going forward we are able to continue to produce results in regions where we have an impeccable track record.”