Iraq approves BP split plan for giant Rumaila oil field

Aug 24 (Reuters) – Iraq on Tuesday approved BP Plc’s (BP.L) plan to expand operations in the country, the government and BP said, as the British oil company seeks to focus on low carbon investments.

The new company, Basra Energy Ltd, would own BP’s stake in Iraq’s giant Rumaila oil field and would be jointly owned by China National Petroleum Corp (CNPET.UL), one of BP’s partners at the site.

In a statement to Reuters, BP confirmed the creation of the new Iraqi joint venture, which it said would allow BP and PetroChina to continue investing in the oilfield for the duration of its existing contract which expires in 2034.

The joint venture will also allow the partners to access “external financing,” BP said.

Discovered in 1953, the Rumaila oil field produces most of Iraq’s total production. Field production began in 2010 and has a capacity of approximately 2.1 million barrels per day (bpd). It produced around 1.5 million bpd in 2020.

The split of oil and gas assets is seen as a way for BP to turn to renewables. BP and Eni (ENI.MI) began talks in May to merge their oil and gas operations in Angola to form one of Africa’s largest energy companies.

The fallout plan was first reported by the Wall Street Journal in June.

Reporting by Ahmed Rasheed and Ron Bousso; Editing by Catherine Evans and Jonathan Oatis

Our Standards: The Thomson Reuters Trust Principles.