ExxonMobil has reached a non-binding agreement with the Iraqi Government to assist in the development of the Majnoon oilfield and enhance oil exports.
Bloomberg previously reported that the US-based oil and gas company is looking to re-enter Iraq two years after leaving.
According to a Reuters report, Iraqi Prime Minister Mohammed Shia al-Sudani announced a non-binding agreement with Exxon but did not provide details.
It follows Iraq’s recent deals with other oil companies including Chevron, bp and TotalEnergies as the country seeks to offer more attractive terms to foreign investors.
Iraq has some of the largest oil and gas reserves globally and aims to increase its output significantly, targeting more than six million barrels per day (/d) by 2029.
Currently, the country produces around /d as challenges such as bureaucratic hurdles, corruption and infrastructure issues hinder progress.
Located 60km from Basra, Majnoon is among the world’s largest oilfields with an estimated 38 billion barrels of oil in place.
The agreement with Exxon will include a profit-sharing arrangement for crude oil and refined products, as well as plans to enhance Iraq’s oil export infrastructure in the southern region.
Additionally, Iraq’s state oil company, the State Organization for Marketing of Oil, is expected to formalise an agreement with Exxon.
The agreement aims to secure storage capacity in the Asian market, potentially leveraging Exxon’s facilities in Singapore, said the report.
Basra Oil Company former crude operations manager and oil analyst Muwafaq Abbas said that the agreement reflects Iraqi officials’ push to modernise the country’s energy sector and improve relations with Washington.
Abbas said: “The deals carry political weight, signalling Baghdad’s intent to rebalance regional ties and deepen its integration with Western markets.”
A spokesperson for Exxon told Reuters: “We are pleased to have signed an HoA (heads of agreement) with the Iraqi Oil Ministry to evaluate exploration, development and oil marketing opportunities in Iraq.”
The US-based oil company previously entered Iraq after the 2003 US invasion but abandoned the West Qurna project due to unsatisfactory returns.
The company also attempted to develop fields in the Kurdistan region but withdrew from those projects as well, citing poor exploration results.
Following its departure from the West Qurna 1 oilfield, Exxon transferred its stake and operatorship to PetroChina.
Recently, Iraq resumed oil exports from its semi-autonomous Kurdistan region to Türkiye after more than two-and-a-half years.
The agreement permits the transport of 180,000–190,000 barrels per day (bpd) of crude to Türkiye’s Ceyhan port, with plans to increase this volume to 230,000bpd.
