Exxon Mobil is reportedly planning to divest its 32.7% stake in Iraq’s West Qurna-1 oil field in a bid to slash its debt.

The Iraqi Ministry of Oil confirmed the chances of the US oil giant exiting its investment in the country by saying it is negotiating with other US companies over a possible purchase of ExxonMobil’s stake in the oil field.

The ministry said: “The Iraqi Ministry of Oil is studying, together with ExxonMobil, the possibility of acquiring the shares of the American company in the West Qurna 1 field in Basra province.”

The 500,000 b/d capacity West Qurna 1 oil well is located in the southern Basrah province. Claimed to be the largest of its kind in the world, the West Qurna-1 field is estimated to have recoverable reserves of more than 20 billion barrels.

Apart from Exxon, the other stakeholders in the project include Chinese state-controlled PetroChina (32.7%), Japan’s Itochu (19.6%), Indonesia’s Pertamina (10%), and Iraq’s Oil Exploration Co. (5%).

The Covid-19 pandemic had affected the finances of ExxonMobil, resulting in its debt surging to more than $70bn, Bloomberg reported.

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By GlobalData

Last year, Bloomberg News reported that China National Petroleum Corporation (CNPC) and CNOOC were interested in purchasing the stake in the West Qurna-1 field.

In November last year, people familiar with the matter told Bloomberg that the stake sale could fetch ExxonMobil at least $500m.

Earlier this year, ExxonMobil sold its 32% stake in the Baeshiqa licence in the Kurdistan region of Iraq to Norwegian oil and gas operator DNO.