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Two More Foreign Oil Firms Plan To Exit Iraq

Oil firms BP and Lukoil are planning to move out of Iraq as the environment becomes seemingly 'inappropriate' for them according to Iraq's oil minister.

From the very words of Ihsan Abdul Jabbar himself, Iraq's oil minister, he said that the existing environment seems to  have become inappropriate for the major oil investors. He voiced this out as two major oil players in the region showed intent of pulling out of the country.

According to him Lukoil has sent in notice to sell their stake in the West Qurna-2 field to Chinese companies and that BP also has plans to exit the giant Rumaila field.

In a video posted on a Facebook page under his name, Jabbar stated that the major investors are either looking for a new market or another partner. He added that the investment environment in Iraq is not encouraging enough for them to stay. 

Jabbar made these statements during a parliamentary session on June 29 to which he was invited. 

Some view that these international companies have been put off by tough contractual terms, payment delays and political instability. 

Over the past few years, long delays in the amendment of the technical service contracts has led some large upstream investors to exit the country. The US firm Occidental quit Iraq's upstream in 2015 and in mid-2018 Shell left the Majnoon oil field.

Protests also have rocked Iraq in the past week due to the worsening power cuts as more demand escalated due to the extreme Summer temperatures.

Iraqis blamed their government which they say has failed to develop its own grid to serve its population and instead has relied on energy imports from Iran. Its electricity minister even resigned just last week due to the pressure over the power crisis. 


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