Maneuvering Around Iraq’s West Qurna-2 Intensifies

Iraq’s state-owned Basrah Oil Co. (BOC) has subcontracted management of the 480,000 barrel per day West Qurna-2 project to a consortium of Italian engineering firm Bonatti and Hilal al-Basrah. The reason given by BOC to project leader Lukoil, in a letter dated Feb. 2 and seen by Energy Intelligence, was to mitigate the impacts of the force majeure declared by the US-sanctioned Russian firm back in November. The letter handed Bonatti and Hilal al-Basrah management of West Qurna-2 “for a period of six months, renewable for another six months.” Lukoil currently gets a $1.15 per barrel remuneration fee for West Qurna-2, the lowest of all Iraq’s major oil projects. The move follows Lukoil’s announcement late last week that it has provisionally agreed to sell its international assets to US private equity group Carlyle, pending approval from Washington.