Lukoil declares Force Majeure in Iraqi Oilfield after Sanctions

Four sources familiar with the situation said that Lukoil declared force majeure on Iraq's West Qurna-2 giant oilfield on Monday after Western sanctions against the Russian oil giant hampered the oil major's operations.

Lukoil didn't immediately respond to an inquiry for a comment.

Last month, the United States and Britain imposed economic sanctions against Lukoil, Russia's second largest oil company. Iraq has stopped all crude and cash payments to Lukoil, according to three sources.

The four sources claim that Lukoil wrote to Iraq's Oil Ministry last Tuesday, stating there were force majeure circumstances that prevented it from carrying out normal operations on the West Qurna-2 oil field.

A senior Iraqi oil official stated that if the cause of the force majeure is not resolved in six months, Lukoil would shut down production and abandon the project.

Last week, it was reported that Iraq's State Oil Firm SOMO had cancelled the loading of three crude oil shipments from Lukoil equity production at West Qurna-2 due to sanctions.

(source: Reuters)