Exxon Mobil is in negotiations to sell 5 percent of its stake in Iraq's West Qurna-1 oilfield to Abu Dhabi's state-run investment fund Mubadala, part of the U.S. major's moves to reduce its exposure there, Iraqi oil officials said on Thursday.

Any sale of a part of West Qurna would follow Exxon's decision last year to sell its stake in the $60 billion field after upsetting Iraq's central government by signing deals with the country's autonomous Kurdistan region.

Iraq's central government had told the U.S. oil company it would have to choose between West Qurna and the Kurdistan oil deals, but Baghdad still offered Exxon sweeter terms in an attempt to keep it working in the southern oilfield.

"Exxon is staying in West Qurna-1 at least until next year, but at same time the company is moving ahead to cut its share in the West Qurna project to shift focus to other projects," said one Iraqi oil official without giving details.

Officials at the United Arab Emirates fund and Exxon were not immediately available to comment.

The two Iraqi oil officials, who spoke on condition of anonymity because they were not authorised to talk to the media, said Exxon's allocation of $1.65 billion to develop the field in 2013 indicated it planned to stay until next year.

The talks with Mubadala follow negotiations with other companies for part of West Qurna.

Indonesia's state-owned oil and gas firm Pertamina is in talks to buy 10-20 percent of the Exxon stake and industry sources have also said China's National Petroleum Corp is willing to join Exxon with part of West Qurna.