Iraq nationalizes Russia's Lukoil oil field — Reuters
Photo: Iraq nationalizes Lukoil's oil field (Getty Images)
The Iraqi Cabinet has approved plans to nationalize the West Qurna-2 oil field to avoid production disruptions linked to US sanctions against Russia's Lukoil, Reuters reports.
According to the agency's sources, the state-owned oil company Basra Oil will take over operations at the oil field for a year.
"We aim to keep production running smoothly as Iraq navigates uncertainty over U.S. sanctions and will look for potential buyers for Lukoil’s stake during the 12-month period," says a Basra Oil representative.
The company will pay the salaries of local employees, operating expenses, and payments to contractors using funds from the Majnoon oil field account, which will be replenished with proceeds from oil sales by the state-owned company SOMO.
Lukoil's 75% operating stake in the field is the Russian oil giant's largest foreign asset. Its production volume is 460,000 barrels per day, which is about 9% of Iraq's total production.
US sanctions against Lukoil
The US has imposed sanctions on two Russian oil companies, Lukoil and Rosneft. In this regard, EU countries with Lukoil refineries have begun to look for solutions to prevent the plants from shutting down.
In particular, the Bulgarian Parliament has allowed the government to appoint a new head of the refinery. The plant may be nationalized and then sold to new owners.
Moldovan officials are discussing with Lukoil the possibility of purchasing the company's facilities at Chisinau Airport. Lukoil has been offered to sell its infrastructure at the airport, including an aviation fuel depot.
Saudi company Midad Energy has become the main contender for the purchase of Lukoil's foreign assets.
The American oil company Chevron and the private investment firm Quantum Capital Group, founded by Texas oil magnate Will VanLo, have also submitted a joint bid to purchase the foreign assets of Russia's Lukoil.
In December 2025, Iraq resumed oil production at the West Qurna-2 field, which belongs to the Russian company Lukoil. Previously, its productivity had been reduced due to a leak in the export pipeline.
