ExxonMobil has concluded a memorandum of understanding with Iraq’s Ministry of Oil, resuming its operations in the country after withdrawing in 2024. The announcement was made by the office of Prime Minister Mohammed Shia al-Sudani during a ceremony held in the south of the country. This preliminary agreement may lead to the development of the Majnoon oil field, located in the Basra region.
The return of a strategic player to a major field
The Majnoon oil field is considered one of Iraq’s largest deposits. It was previously operated by Anglo-Dutch company Shell, which withdrew in 2017. Since then, a state-owned Iraqi company has been in charge of its operations. ExxonMobil’s return to the site comes as Baghdad seeks to renew partnerships with major international companies.
The Prime Minister stated that his government wished “to collaborate with major oil companies, particularly American ones”, in order to boost production capacity and modernise infrastructure. He highlighted the expected role of ExxonMobil in optimising exports and introducing new technologies in the country’s oil installations.
Negotiations still underway on final terms
The memorandum of understanding does not yet constitute a binding contract. A source within the Ministry of Oil confirmed that discussions are ongoing regarding the development terms of the Majnoon field and that further negotiations will be required before finalising a definitive agreement.
Meanwhile, the Iraqi national oil marketing company (SOMO) has opened talks with ExxonMobil to secure storage capacity in Singapore, which could lead to a logistical diversification of the country’s crude oil exports.
Oil, a central pillar of the Iraqi economy
Iraq, a founding member of the Organization of the Petroleum Exporting Countries (OPEC), continues to rely heavily on crude oil exports, which account for 90% of its public revenue. The country currently exports 3.4 million barrels per day.
ExxonMobil had exited Iraq in 2024 by withdrawing from the West Qurna 1 field, which the company deemed insufficiently profitable. That field was subsequently taken over by a Chinese company, further expanding Beijing’s presence in Iraq’s energy sector.
