ConocoPhillips (COP) shares climbed Friday after the company announced it would buy a 42% stake in BP Plc's (BP) BP Energy Company of Kirkuk Limited (BP ECKL). The move gives ConocoPhillips a foothold in northern Iraq's oil-rich Kirkuk region, and the market seems to like what it sees.
The broader market helped too. While tech and AI stocks took a hit Friday, investors rotated into energy names. Elevated crude oil prices and ongoing geopolitical tensions are keeping expectations high for strong cash flows across major oil producers.
ConocoPhillips Expands In Iraq
The acquisition gives ConocoPhillips exposure to four producing oil fields in northern Iraq. BP ECKL holds the development and production contract covering the Baba and Avanah domes of the Kirkuk oil field, along with Bai Hassan, Jambur and Khabbaz.
The contract includes more than 3 billion barrels of oil equivalent in initial gross recoverable resources. The partners plan to rehabilitate the fields, optimize production and pursue exploration opportunities.
Capital-Efficient Growth
ConocoPhillips expects the transaction to close by the end of 2026, subject to regulatory approvals and customary conditions. The deal has an effective date of July 1, 2026.
After closing, ConocoPhillips will account for BP ECKL as an equity affiliate. The company expects limited capital contributions, with remuneration tied to its share of incremental production and costs.
“This unique redevelopment opportunity is well aligned with our disciplined investment framework, providing access to a material, high-quality and long-life resource base, comfortably meeting our cost of supply threshold,” Chairman and CEO Ryan Lance said.
