ExxonMobil has signed a memorandum of understanding with Basra Oil Company, Iraq’s oil ministry said on Wednesday. The ExxonMobil Basra seawater deal covers phase two of a project for Iraq’s southern oilfields.
What the ExxonMobil Basra seawater project does
In general, oilfields lose pressure as they age. So operators inject water to keep the oil flowing. This phase will handle up to 2.5 mmbbl/d of water, the ministry said.
Moreover, it will complement a larger scheme that TotalEnergies is already building, with a capacity of 5 mmbbl/d. In addition, oil minister Basim Mohammed Khudair said the deal fits a plan to bring in foreign firms and lift output.
Why it matters
Water supply has long limited Iraq’s plans to raise production in the south. Therefore, these projects matter for future exports, including to India, a major buyer of Basra crude. The minister added that Iraq also holds agreements with Chevron and other US firms.
However, an MoU is not a final contract. The ministry gave no cost or timing.
Meanwhile, the majors are flush with cash. Read our report on their expected bumper third-quarter profits.
For a deeper analysis, read: ExxonMobil’s Basra Seawater Deal: Why Iraq’s Oil Ambitions Depend on Water
