ConocoPhillips to Buy 42% Stake in BP’s Iraq Kirkuk Oil Venture

Energy News Beat

In a significant move strengthening U.S. energy ties with Iraq, ConocoPhillips has agreed to acquire a 42% interest in BP Energy Company of Kirkuk Limited (BP ECKL), the contractor entity overseeing the redevelopment of major oil fields in northern Iraq’s Kirkuk region. BP will retain the remaining 58% majority stake.

The deal, announced on July 17, 2026, aligns with Iraqi Prime Minister Ali Al-Zaidi’s official visit to Washington, D.C., and forms part of a broader package of U.S.-Iraq energy and economic agreements. It brings together two major international oil companies to advance the rehabilitation of historically significant fields while supporting Iraq’s ambitions to boost production and diversify export routes.

Details of the Kirkuk Redevelopment Project

BP ECKL holds a Development and Production Contract (DPC) with Iraq’s North Oil Company (NOC) and North Gas Company (NGC). The project focuses on the rehabilitation and redevelopment of several large-scale oil fields in the Kirkuk area of Federal Iraq, specifically:

The Baba and Avanah domes of the Kirkuk oil field.
The adjacent Bai Hassan, Jambur, and Khabbaz fields.

These fields are currently operated by NOC. The contract covers oil and gas production, gas processing facilities, power and water infrastructure, and includes exploration potential.

The initial phase targets more than 3 billion barrels of oil equivalent (boe) in oil and gas production. The wider contract area and surrounding region hold potential for up to 20 billion boe.

Remuneration under the DPC is linked to incremental production volumes, price, and costs. Partners will book a proportionate share of production and reserves. The transaction does not alter the existing contract framework, the operators’ roles, or the planned transition of operatorship to an unincorporated organization primarily staffed by NOC and NGC personnel.

BP’s CEO Meg O’Neill commented: “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.”

The partnership reflects BP’s disciplined capital allocation approach and leverages the companies’ complementary expertise. BP maintains a century-long relationship with Iraq, including long-standing operations at the Rumaila field in the south.

The deal is subject to regulatory approvals. ConocoPhillips did not disclose financial terms, and the companies have indicated expectations of capital-efficient execution, leveraging the existing production base and exploration upside.

Broader U.S. Involvement in Iraq’s Energy Sector and Pipelines

The ConocoPhillips-BP partnership is part of a larger wave of U.S. energy engagement with Iraq. During Prime Minister Al-Zaidi’s Washington visit, Iraq and the U.S. signed or advanced approximately 48 economic agreements and memorandums of understanding (MoUs) across energy, infrastructure, technology, and other sectors. These are valued at tens of billions of dollars, with U.S. Energy officials noting agreements with American energy companies exceeding $60 billion.

Key U.S. companies advancing projects include:Chevron: Involved in a consortium with U.S.-based Capital TI and Qatar’s UCC for feasibility studies on strategic new crude oil export pipelines. Routes under evaluation include Basra–Haditha–Kirkuk–Ceyhan (to Turkey’s Mediterranean terminal) and Basra–Haditha–Baniyas (to Syria’s Mediterranean coast). These aim to diversify exports and reduce reliance on the Strait of Hormuz. Chevron also has agreements related to West Qurna-2 field management/transfer and development of the Nasiriyah project (including exploration blocks) and Balad field.

ExxonMobil: Signed partnership frameworks as part of the broader U.S.-Iraq energy pacts.

Halliburton: Agreements for oil field management and development, including boosting output at fields like Bin Omar and Sinbad.

KBR: Consultancy services for the Basra–Haditha pipeline project and broader energy partnerships.

GE Vernova and others: Frameworks for electricity generation and infrastructure (e.g., combined-cycle gas plants).

Iraq is also pursuing an Energy and Development Fund with the U.S., potentially mobilizing hundreds of billions over decades through dedicated oil production allocations, to finance power, infrastructure, and development projects with American companies. Baghdad aims to raise national oil production capacity significantly (targeting 6–7 million barrels per day in the coming years) through these international partnerships.

These developments, including new pipeline studies and field redevelopment, position U.S. firms prominently in Iraq’s upstream, midstream, and infrastructure sectors, supporting both production growth and export security.

Strategic Implications

The Kirkuk venture revives one of Iraq’s oldest and most iconic oil regions—where oil was first discovered in the 1920s—while injecting fresh capital and expertise. Combined with pipeline diversification efforts, it enhances Iraq’s resilience amid regional geopolitical tensions and supports long-term energy ambitions.For ConocoPhillips and BP, the capital-efficient structure offers exposure to a large existing production base with exploration upside. For Iraq, it accelerates redevelopment, creates local economic benefits (jobs, supply chain development), and deepens strategic economic ties with the United States.The transaction underscores a shifting dynamic in U.S.-Iraq relations, moving further toward commercial and investment partnerships.

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