In an effort to focus on clean-energy transition, British oil major Beyond Petroleum (BP) and PetroChina have formed a joint venture to manage Iraq's Rumaila field.
BP is kick-starting its transformation to reduce emissions and hydrocarbon output as they ramp up clean-energy production. However, the strategy fits awkwardly in Iraq, which is one of the world's biggest emitters of methane, a greenhouse gas significantly worse than carbon dioxide.
Basra Energy Co. Ltd. will run Rumaila with Iraq's state-owned Basra Oil Co. as a standalone company where it will have access to external financing. While the venture may not lower the number of greenhouse emissions, it will, however, free up capital for BP's future low-carbon projects.
Back in 2016, BP formed Aker BP ASA by merging its Norwegian assets with Det Norske Oljeselskap. Recently, Italy's Eni SpA and BP are considering merging their Angolan oil, liquefied natural gas, and gas assets in an attempt to revive output.
Iraq's cabinet has authorized the reformation and added that Basra Energy will be the one to finance and develop the field, according to Oil Minister Ihsan Abdul Jabbar.
Jabbar stated in July that BP once planned to pull out of Rumaila and that the government was working to improve operating conditions for foreign oil companies to prevent them from leaving.
BP gained the right to develop Rumaila in 2010, one of the world's largest oil fields, pumping 1.4 million barrels per day in 2020. The new joint venture is expected to last until the contract's expiration in 2034.