BP is reportedly seeking a partner to share the costs and development efforts at the Kirkuk oilfield in Iraq, following a redevelopment deal signed with the Iraqi government in February 2024.

Scope of the Kirkuk Development Deal

The contract involves redeveloping more than 3 billion barrels of oil equivalent across the Baba and Avanah domes of the Kirkuk field and three adjacent fields: Bai Hassan, Jambur, and Khabbaz. These fields were previously operated by the state-owned North Oil Company (NOC) but will now be managed by a new unincorporated organization comprising personnel from NOC and the North Gas Company.

Strategic Importance and Costs

The Kirkuk contract is a key part of BP's strategy to boost earnings, offering a better margin than its existing contract at the Rumaila field. It also provides BP with its first access to Iraqi gas and exploration potential via a memorandum of understanding that could unlock estimated resources of up to 20 billion barrels of oil equivalent. However, media reports highlight significant annual costs of approximately $1 billion over the 25-year contract term.

Production Goals and Broader Context

BP has ambitious plans to nearly double Kirkuk's production capacity. This aligns with Iraq's national strategy to increase its overall oil and gas output capacity to over 6 million barrels of oil equivalent per day by 2029. BP is concurrently involved in developing the Rumaila field in southern Iraq, a joint venture with PetroChina and Basra Oil Company, which holds an estimated 17 billion barrels of remaining recoverable oil reserves.

Current Status

The process to identify potential investors for the Kirkuk project is underway. BP has declined to comment on what it terms "market speculation" regarding the search for a partner.