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Iraq would favor CNPC and Lukoil bids for Exxon oil stake
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Friday, 23 Nov 2012
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Iraq would favor bids by Russia's Lukoil and China's CNPC if they decided to buy Exxon Mobil's stake in the super-giant West Qurna-1 oilfield.

A senior oil ministry official said that a sale of the stake to either company would significantly strengthen the position of Russian or China in exploiting Iraq's oil reserves, the world's fourth biggest.

The official said that during two separate meetings with executives from CNPC and Lukoil, Iraq informed the companies that it favors their contribution to purchase Exxon's share in West Qurna-1 oilfield.

Baghdad said that it had received positive signals from both companies that they will consider making an offer for the USD 50 billion project which Exxon wants to pull out of to focus on its deal for exploration blocks in Iraq's autonomous Kurdish region.

Exxon riled Baghdad by signing deals last year with the Kurdistan regional government. Baghdad rejects contracts granted by the KRG as illegal and told Exxon it had to choose between working in southern Iraq or Kurdistan in the north. The US oil major opted to stick with Kurdistan, where the contracts are seen as more lucrative.

The official on condition of anonymity said that we have received positive signals from both CNPC and Lukoil that they will consider purchasing Exxon's stake in West Qurna-1. Iraq believes that both companies have enough financial resources and the technology to manage the giant oilfield instead of Exxon Mobil.

Sources said that Exxon has now opened a virtual data room for West Qurna-1 and approached all likely buyers, inviting bids by December 5th 2012. Lukoil, Russia's second-largest crude producer which is already developing West Qurna-2, had previously said West Qurna-1 was too big for it to swallow but last week said it was looking into the option. That has prompted some speculation it could team up with another company, possibly CNPC to develop the field.

Source - Aswat Aliraq


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