The Russian company Lukoil informed the Iraqi government about force majeure at the West Qurna-2 field due to US and UK sanctions. Iraq has suspended all payments to Lukoil, which could lead to a halt in production at the field.
Russian oil company Lukoil has notified the Iraqi government of force majeure at the West Qurna-2 oil field after US and UK sanctions blocked its operations and payments. This is reported by UNN with reference to Reuters.
Details
Iraq has suspended all cash and crude oil payments to the Russian company Lukoil after sanctions were imposed against it and Rosneft. Last week, the state oil company SOMO canceled three shipments of oil from the West Qurna-2 field.
In a letter to the Iraqi Ministry of Oil, Lukoil stated that it could not continue operations due to force majeure circumstances preventing the continuation of work at the West Qurna-2 field. If the situation does not change, the company will cease production and leave the project.
According to an Iraqi official, production at West Qurna-2 is about 480,000 barrels per day, which is approximately 9% of Iraq's total production. Oil supplies scheduled for November – about 4 million barrels – have been canceled.
Iraqi oil ministry officials said Lukoil's declaration of force majeure was approved in accordance with the terms of its contract, and the company is seeking legal protection from penalties for non-fulfillment of contractual obligations to the oil ministry.
Recall
Earlier, UNN reported that millions of tons of Russian oil were shipped through a port partly owned by Macquarie Bank and potentially sold to Australian companies.
