Chevron buying 2 Kurdistan blocks from Reliance

Chevron buying 2 Kurdistan blocks from Reliance

Chevron Corp is buying control of two blocks in Iraq's Kurdistan, industry sources said, as the second-largest U.S. oil company follows larger rival Exxon Mobil Corp into a region where oil rights are a subject of fierce dispute

July 19, 2012 1:25 by Reuters

Chevron Corp is buying control of two blocks in Iraq’s Kurdistan, industry sources said, as the second-largest U.S. oil company follows larger rival Exxon Mobil Corp into a region where oil rights are a subject of fierce dispute.

Chevron’s purchase of 80 percent of the Sarta and Rovi blocks from India’s Reliance Industries Ltd is a foray into Iraq for the oil company after it was not involved in contracts awarded in Iraq’s four licensing rounds. Austria’s OMV AG holds the other 20 percent of Sarta/Rovi.

Exxon angered Baghdad last year by signing an exploration deal with the Kurdistan Regional Government in the north, which the central government deemed illegal.

Just last month, Iraq asked U.S. President Barack Obama to stop Exxon from exploring in the autonomous region because it could have dire consequences for the country’s stability.

Chevron declined to comment on the deal on Wednesday, but said it continued to be interested in pursuing opportunities that “help Iraq achieve its objectives for the oil and gas industry.”

Britain’s Sunday Times newspaper, reporting the talks between Reliance and Chevron over the weekend, said the Reliance deal was thought to be worth about $200 million.