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Complications Develop Over Exxon and Petrochina's $53 Billion Iraq Deal

Deal reported to have setback following increased tensions in the region and contract disputes over the sale of production

A $53 billion mega project involving ExxonMobil and Petrochina to boost oil production in Basra, southern Iraq has come under threat following a combination of contract issues and security concerns.

The initial plans for the deal involve the development of two oilfields - Nahr Bin Umar and Artawi, with Exxon to construct a new water treatment facility and pipelines to support an increase in oil production.

Tensions have escalated in the region following the ongoing sanctions and disputes between the United States and Iran, whilst Exxon's plans to share its oil production have been opposed by Iraqi government officials.

Despite the outstanding issues, Fayadh Nema - Iraq's deputy oil minister for upstream operations, has revealed that talks between the parties are ongoing and they expect a deal to be successfully negotiated in the near future.

In recent weeks, ExxonMobil has also twice evacuated foreign staff from its Basra operations, in response to heightened security risks, which has slowed negotiations over the deal.

Source: Reuters

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