Global energy major ExxonMobil (NYSE:XOM) has exited the West Qurna 1 oilfield in southern Iraq as the lead contractor, according to Reuters. The company has now handed over its operations in the field to PetroChina.
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Following Exxon’s exit, PetroChina now holds the largest stake in the West Qurna 1 oilfield, which produces about 550,000 barrels a day. Exxon’s exit from the oilfield comes after Iraq’s Basra Oil acquired its 22.7% stake in West Qurna 1. Indonesia’s Pertamina picked up the remaining 10%.
Next, PetroChina and Iraq aim to increase output at the oilfield to nearly 600,000 barrels a day by the end of this year. Notably, recoverable reserves at West Qurna 1 are estimated at over 20 million barrels.
With this exit, Exxon will no longer have any presence in Iraq’s energy space. Meanwhile, oil prices are on the rise as tensions in the Middle East escalate. Brent crude is hovering 2.2% higher at about $78.74 today after U.S. choppers recently repelled an attack by Houthi militants and Iran sent a warship into the Red Sea.
Is XOM a Buy, Sell, or Hold?
Amid these developments, Exxon shares are trending nearly 1.2% higher in the early session today. Overall, the Street has a Moderate Buy consensus rating on Exxon, and the average XOM price target of $129 points to a substantial 29% potential upside in the stock.
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