Exxon Contemplates Offer for Kurdistan Oil Field (XOM)

Exxon Mobil Corp. (NYSE: XOM) is considering making a $10.9 billion takeover bid for British oil & gas company Gulf Keystone Petroleum, according to a report from the UK’s The Independent. The British firm has discovered a massive 10-11 billion barrel field, called Shaikan, in Iraq’s Kurdistan province and the semi-autonomous Kurdish government wants a large firm with deep pockets to take on development of the field.

Neither GKP, as the British firm is known, nor Exxon would comment on the report.

The sticking point could turn out to be the ongoing dispute between the Kurdish government and the national government. Both claim the right to issue licenses (and collecting royalty payments) for developing fields in Kurdistan.

Exxon has already taken six licenses from the Kurdish government, bringing a threat from the national government to rescind licenses that the company holds in the south. It is unlikely that Exxon would be willing to give up those southern rights, but the Shaikan field is certainly a tempting prize.