By John Lee.
ConocoPhillips has agreed to acquire a 42% interest in BP Energy Company of Kirkuk Limited (BP ECKL) from BP, supporting the redevelopment of four producing oil fields in the Kirkuk area of northern Iraq. The agreement is expected to be signed during Prime Minister Ali al-Zaidi's official visit to Washington, D.C.
BP ECKL holds the Development and Production Contract (DPC) covering the Baba and Avanah domes of the Kirkuk oil field and three adjacent fields in federal Iraq: the Bai Hassan oil field, Jambur and Khabbaz. The DPC covers an initial gross recoverable resource of more than 3 billion barrels of oil equivalent, to be recovered through field rehabilitation, redevelopment and optimisation activities. The contract area also includes additional exploration potential.
The transaction is expected to close by the end of 2026, subject to regulatory approvals, with an effective date of 1 July 2026. Upon closing, the BP ECKL joint venture will be accounted for as an equity affiliate and is not expected to require significant capital contributions from ConocoPhillips, with remuneration linked to a proportionate share of incremental production and costs.
Ryan Lance, chairman and chief executive officer of ConocoPhillips, said:
"This unique redevelopment opportunity is well aligned with our disciplined investment framework, providing access to a material, high-quality and long-life resource base, comfortably meeting our cost of supply threshold
"Consistent with our focus on capital discipline, we see an opportunity to create value through a capital-efficient redevelopment program that leverages a large existing production base, while also offering meaningful exploration upside.
"We look forward to working with bp and the Government of Iraq to support the continued redevelopment of these historically significant fields in an important energy-producing region."
BP Chief executive officer Meg O'Neill said:
"Kirkuk is a world-class resource base that can support Iraq's long-term energy ambitions while creating value for both the country and bp.
"This partnership with ConocoPhillips brings together two great teams and positions us well for the next phase of redevelopment.
"We're being deliberate about where we invest, backing high-quality resources that can deliver long-term value for our shareholders."
(Sources: ConocoPhillips / BP)
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