Independent Chinese oil firms gain ground in Iraq
Independent Chinese oil companies are expanding their footprint in Iraq, OPEC's second-largest producer, entering a market once dominated by major global energy firms.
Industry executives told Reuters that these smaller Chinese companies, many led by former state oil experts, aim to double their production in Iraq to 500K barrels per day (bpd) by 2030. They are leveraging more profitable contractual terms, lower development costs, and faster growth opportunities.
These companies made significant gains in 2024, securing half of Iraq's oil exploration licenses amid Baghdad's push to accelerate projects and raise national production capacity to over 6M bpd by 2029.
Among the key players are Geo-Jade Petroleum, United Energy Group, Zhongman Petroleum and Gas, and Anton Oilfield Services.
The Iraqi Ministry of Oil has emphasized its commitment to attracting international companies but has shown increasing openness toward the expansion of independent Chinese firms, citing their flexibility, speed of execution, competitive financing, and access to low-cost Chinese resources.
Baghdad's shift last year from "fixed-fee" contracts to "profit-sharing" agreements has also encouraged the entry of these companies, which are more willing to take risks than global giants such as Shell and ExxonMobil, both of which have scaled back their presence in Iraq.
Ali Abdul-Amir of Basra Oil Company said independent Chinese firms offer key advantages, including rapid financing and cost reduction. 'They accept lower profit margins in exchange for long-term contracts, making them well-suited to Iraq's expansion plans in the oil sector,' he added.
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