Major oil companies are returning to Iraq amid the war, as the country offers the desired returns for the first time in decades. Iraq's new contracts are closer to production sharing than service contracts, allowing companies to profit from rising oil prices and record reserves on their balance sheets.
More Attractive Financial Conditions
Mike Wirth, CEO of Chevron, said last week at the Energy Intelligence Forum in London, "Iraq's financial conditions have become more attractive." This statement clearly reflects positive changes in Iraq's economic situation and the willingness of oil companies to invest in the country.
Cheron has signed a preliminary agreement with Baghdad for former Lukoil assets, with the final contract expected in 2027. These agreements reflect the renewed confidence of oil companies in Iraq and the country's high capacity for oil production.
New Investments
TotalEnergies was the first oil giant to enter Iraq three years ago with a $27 billion investment under better conditions. BP and ConocoPhillips later joined this trend. According to Bloomberg estimates, Iraq's production capacity could reach 5.5 million barrels per day by 2029. Before the current war in the region, Iraq's production capacity was 4.5 million barrels.
These developments indicate a major shift in Iraq's oil landscape, where major oil companies are seeking new opportunities to increase production and efficiency. With rising global oil prices and the need for energy supply, Iraq is becoming more important than ever as one of the main sources in this regard.
