CNPC looks likely to acquire a 60% share in Iraq's $50bn oilfield.
China National Petroleum Corp (CNPC parent of PetroChina, has emerged as the frontrunner to take over ExxonMobil’s 60% stake in Iraq’s West Qurna-1 oilfield, after political pressure has forced the US-based oil giant to part with its share in the massive southern oilfield. A successful acquisition from a Chinese company would seriously diminish Western oil influence in Iraq.
Although there are rival bidders, CNPC unit PetroChina looks likely to take a significantly larger position in the $50 billion oilfield. As a state-owned company, CNPC is much more likely to accept tougher terms and lower profits than its Western counterparts, as securing reserves is a strategic necessity.
Over the past ten years, China has been steadily increasing its influence in Iraq, which boasts the world’s fourth-largest oil reserves. While fellow major, Sinopec Group, has made significant purchases in the country’s northern Kurdish region, the new deal would mean the troubled nation’s reserves would be dominated by Chinese companies.
Almost a decade after the Iraq war began, stability is still an issue and disputes between Kurdistan and Baghdad frequently causes disturbances in the oil industry.
However, the acquisition is far from over. One Western oil executive working in the region said they “would be surprised if Exxon actually exits” and is “betting on some twists and turns ahead.”