BP Plc and the Iraqi government took another step toward reviving one of the OPEC member’s most prolific oil and gas resources, the Kirkuk field.
The agreement on technical terms to redevelop the field in the north of Iraq is an important step toward a fully termed contract, BP Executive Vice President William Lin said in a statement on Thursday. Negotiations are expected to be complete early in 2025, the company said.
Iraq, which holds the world’s fifth-largest proved crude reserves, has a long history with BP. The company was part of the consortium that discovered oil in Kirkuk in the 1920s, and returned to the country after the fall of Saddam Hussein to help redevelop the giant Rumaila oil field.
“We are grateful to the Iraqi government for its continued support of BP’s activities in the country, particularly around Rumaila,” said Lin. Baghdad has shown “dedicated engagement to progress negotiations on the potential future development of these critically important fields in and around Kirkuk.”
BP initially agreed to help redevelop Kirkuk in 2013, but that effort was stymied by the fall of northern Iraqi city Mosul to the terror group Islamic State the following year. Now, the field appears to be an important part of BP’s upstream strategy under Chief Executive Murray Auchincloss, who took on the job permanently at the start of this year.
Kirkuk was the world’s largest oil discovery when BP helped to find it in 1927, but the field has suffered from years of neglect and regional instability. Thursday’s technical agreement follows a memorandum of understanding signed by BP and Iraq in August for a wider program of investment and exploration in the region.