Iraq Business News

Iraq Makes Initial $650m Oil Payment to KRG

By John Lee.
Iraq’s, Deputy Prime Minister for Economic and Industrial Affairs, Dr Rowsh N Shaways, told Reuters on Tuesday that Baghdad’s Finance Ministry has begun payment of an initial $650 million to Iraqi Kurdistan for oil companies working in the region.
Erbil and Baghdad agreed last month to draw a line under a dispute over oil payments, after Kurdistan pledged to continue exports and Baghdad said it would pay foreign companies working there.
“The federal Finance Ministry has started transferring the first oil payment of $650 million to the Kurdish region,” said Dr Shaways, a Kurdish member of the central government negotiating team.
(Sources: Reuters, AIN)

Brinkley Lands Deal to Modernise Iraqi Port

By John Lee.
Iraq signed a $14-million deal with a U.S. consortium on Tuesday to modernise the Maqal Port on Shatt al-Arab waterway.
The consortium, led by North America Western Asia Holdings (NAWAH), will invest in a new heavy-lift crane as well as container handling capabilities, and will build a modern container yard in one of the 14 berths at the 93-year-old port.

As part of the 10-year agreement, it will also will dredge the Shatt al-Arab to nine meters to make it a “deep water”port.”Modernising Maqal Port is one step in Iraq’s greater vision to improve and expand our country’s shipping and port capabilities,” the Iraqi minister of transportation, Hadi al-Amiri, said in a statement. He added that NAWAH’s commitment to Iraq’s long-term economic growth “sends a strong message to other American and international investors that Iraq is truly ripe for investment.”Teaming up with NAWAH are the New Jersey-based Triton Container International Ltd., the world’s largest owner-lessor of marine cargo containers, and the Chicago-based Marmon Crane Services, an international owner, operator and lessor of crane equipment that operates in 14 countries around the world.
NAWAH is headed up by former Pentagon official Paul Brinkley (pictured), who was Director of the Task Force for Business and Stability Operations (TFBSO) in Iraq, responsible for economic revitalisation and stabilisation efforts in the country.
(Sources: Washington Post, US Dept of Defense)

Iraq Mega Projects Kicks Off in Dubai

Advertising Feature
The third edition of CWC’s Iraq Mega Projects Conference & Exhibition opened its doors on Monday at the Madinat Jumeirah, Dubai, under the Patronage of His Highness Sheikh Mohammed Bin Maktoum Bin Juma Al Maktoum.
The three-day event, being held 1-3 October 2012, will bring together stakeholders from across the value chain to identify project and infrastructure investment opportunities in support of oilfield production in Iraq.
The event began on 1 October 2012 with a Master Class hosted by Ernst & Young and Eversheds, “Understanding the Investment Structure for Iraq Mega Projects Contracts”. The class was aimed at helping investors accurately gauge and respond to investment risks in Iraq. It sought to clarify investment information, accounting and taxation practices.
“Iraq offers incredible opportunities for investors to help develop the country’s energy infrastructure. At the same time, it brings its unique challenges and environment. The purpose of the Iraq Mega Projects Master Class is to facilitate investors with the information and tools required to navigate Iraq’s investment landscape to help draw further investment for uplift and energy development,” said H Frederic Ponton, Director of Government Relations – Middle East, CWC Group.
The Conference, kicked off on 2 October 2012, and began with an overview of oil and gas field development in 2012 and 2013, offering an understanding of the Iraq Mega Project landscape before delving into specialised sessions on water, gas and power, logistics, employee training and retention. In support of the Conference, the Exhibition also kicked off on 2 October 2012, and showcased the latest technologies, tools and services pertinent to oilfield production and development in Iraq.
“There is no doubt about Iraq’s potential, or its crude output volume. Yet judicious investments must be made towards upgrading infrastructure and assets to ensure that the energy sector in the country can develop further. We hope to see Iraq Mega Projects become the platform for bringing together leading stakeholders in the industry to communicate, network and drive the necessary investment to the country. There is absolutely no doubt that the opportunities for investment and growth in Iraq are remarkable.” Natalie Bacon, Conference Producer, CWC Group.
(Source: CWC)
(Picture: Taleb Al Hassan, Governor of Dhi Qar)

Oil vs Tomatoes: Basra’s Farmers Continue To Protest

By Waheed Ghanim.
This article was originally published by Niqash. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
Basra’s farmers say the oil industry is “occupying” their land – and that the one thing the Iraqi government is forgetting in its race to get oil firms in and farmers out, is the rising cost of the food Iraq can no longer grow itself.
Just over a year ago, Saleh Mohammed was farming in the Qurna area, west of the southern Iraqi city of Basra. But then the oil companies came. And today the land that Mohammed once farmed belongs to international oil giant, Exxon Mobil. And Mohammed himself works as an employee on the periphery of one of the oil production facilities.
Mohammed is 30 and his field of expertise is agriculture; he knows the ways of nature. He worked on his 2.5 hectare property planting wheat, barley and dates and everything he knew, he learned from his parents and grandparents, who had farmed the land before him. He really doesn’t know much about the oil industry. Yet, like so many others here, he too now wears the grey overalls and cap of oil facility workers.
“When the American, Russian and British oil companies started to come here, the government just wanted us to disappear,” Mohammed says. “They even offered us financial compensation to do so. Now some of us work as watchmen, some of us as gardeners and some as labourers with the oil companies for around US$600 a month. And I didn’t really have a choice in this matter – I have a wife and four children to look after.”
Mohammed is not alone. It’s estimated that there are 43 billion barrels of oil under the ground in this region. Almost all of Iraq’s oil currently comes from here. All of which clearly means big business, not only for the oil companies, but also for the Iraqi government.

Iraq to Spend $500bn on Energy Industries

Iraq will invest around $500 billion in energy and linked industries with the help of the private sector by 2030, the Deputy Prime Minister for Energy told a conference hosted by the Iraq British Business Council and Iraq’s National Investment Commission.
Dr Hussain al-Sharistani (pictured) said the move would generate around $6 trillion in revenues and create around 250,000 new jobs.
Speaking in Baghdad he also unveiled plans for what he called: “a massive development plan for the oil and as industry,” including new terminals, refineries and pipelines.
Al Sharistani said:
The volume of work is unprecedented in the oil industry.”
“As for investment opportunities; investments between now and 2030 in the energy sector and linked industries will amount to about $500 billion, of which 80 billion is expected to come from the private sector.
Shahristani delivered a broad ranging vision of Iraq’s energy needs and also revealed plans for the Ministry of Electricity’s to upgrade and build new power projects to solve power outages which leave millions of Iraqis with electricity for only 8-10 hours a day.
He said:
Power generation capacity is expected to reach 22 gigawatts to meet demand in 2016.
“The ministry of electricity is also planning to upgrade the existing and the new gas turbine stations from single to combined cycle to increase power to about 30 gigawatt in 10 years.
Shahristani said the Ministry planned to exploit solar energy. He added:
There are invitations for companies to build solar power stations in remote desert areas and this is part of the set plan to develop the power sector in Iraq.
The two day conference was also attended by Iraq Deputy Prime Minister Dr Rowsch Shaways who said:
My goal is to bring life to our economy to achieve a proper standard of living for our people and enable Iraq to take its place in the world community.
“The Iraqi people deserve the best and we are seeking assistance from nations like Britain. We need to get away from the state doing everything. The Iraqi market is promising and it is broad and thirsty for investment.”
Baroness Nicholson of Winterbourne led the IBBC delegation of 30 mainly Western businessmen and women to the Iraqi capital and told the conference:
Nearly ten years since the dark days of the previous regime the steady light of freedom and democracy is burning in Iraq today. Foreign investment is needed to ensure that light turns into a glittering future for Iraq.
(Source: IBBC)

$125m Allocated to Build 182 Schools

By John Lee.
Azzaman reports that Iraq’s Ministry of Education has allocated $125 million to build 182 schools in four Iraq provinces.
98 schools are to be built in Salahaddin, with the rest in the provinces of Nineveh, Kirkuk and Diyala.
The state-run al-Simoud Steel Enterprise, one of Iraq’s largest domestic pre-fab companies, is building the schools.
Under the contract, the firm imust have the schools ready by the end of the year.
(Source: Azzaman)

Leighton Wins $200m Iraq Contract

By John Lee.
Habtoor Leighton Group (HLG) has been awarded a sub-contract for the construction of infrastructure in Southern Iraq and is part of an engineering, procurement and construction project to deliver a central production facility.
The Australian reports that the contract is valued at more than $200 million.
HLG CEO and Managing Director Laurie Voyer (pictured) said, the project is in line with the Group’s strategy to diversify its work by type and geography and will be the first contract HLG has been awarded in Iraq.
“HLG has developed an outstanding reputation for delivering complex projects in remote locations, and we are delighted to be working on this key project,” he said.
HLG’s initial scope of works comprises the partial engineering, and construction of civil, utility, and infrastructure works, including:

  • Site offices
  • Earthworks, roads and buildings
  • Equipment installation, electrical and instrumentation
  • Oil and water storage tanks
  • Pre-commissioning

“This project provides HLG with an opportunity to demonstrate our outstanding construction capabilities and ability to deliver the project to the highest international standards,” said HLG Chairman, Riad T Sadik.
“We appreciate the importance of this project, and its successful delivery will stand HLG in good stead to secure additional oil and gas-related work – further cementing our position as one of the leading diversified international contractors in the Middle East and North Africa,” Mr Sadik said.
Works will commence immediately, with completion scheduled for early 2014.
(Sources: HLG, The Australian)

Iraq’s Petroleum Sector Development – Opportunities & Challenges

By Ahmed Mousa Jiyad.
Since mid-2009 Iraq has been pursuing aggressive strategy to develop the country’s petroleum sector, especially the upstream and midstream subsectors. Such development efforts would, if realized, bring outstanding results for Iraq and the world petroleum market. However, there are huge uncertainties and formidable challenges in the path of such unprecedented expansion.
The attached PowerPoint presentation aims at and is structured to provide comprehensive but brief review of the main features of the Iraqi petroleum policy and development strategy. It is based on different official statements, declared objectives, sectoral plans, concluded contracts and international cooperation modalities, among others.
To be specific the presentation focuses on the following main topics:

  • Augments Petroleum Proven Reserves
  • Enhance Production Capacities
  • Expand and Diversify Export Outlets and market configuration
  • Increase Gas Utilization & Reduce Gas Flaring
  • Develop Refining Capacities & Petrochemical Industry
  • FDI-IOCs Involvement & International Cooperation
  • NES, NDP and Managing the Plenty from Sustainable Development and Macroeconomic Perspectives
  • Main Determinants Facing Iraq’s Petroleum Strategy

Please click here to view Ahmed Mousa Jiyad’s presentation.

Audio: BBC Interview Ashti Hawrami

Kurds in Iraq are growing restless and impatient over the violence and open political rivalries in Baghdad, between Shias and Sunnis.
Iraq’s autonomous Kurdish region of four million is a haven of relative stability and prosperity and what’s more has its own oil riches to exploit.
HARDtalk’s Zeinab Badawi speaks to Ashti Hawrami (pictured). For the last six years, he’s been Minister for Natural Resources in Kurdistan’s regional government.
Why are Kurds upsetting the central government by increasingly seizing control of their oil resources and exports? Do they have plans to breakaway?
Please click here to download the full BBC HARDtalk interview.
(Source: BBC)

PM Barzani Welcomes New Dutch Ambassador

By John Lee.
Prime Minister Nechirvan Barzani welcomed the Netherlands’ new Ambassador to Iraq, Mr Harry Molenaar (pictured), recently, discussing the growing relationship between their governments.
Ambassador Molenaar highlighted the importance of the new Dutch Embassy Liaison Office in Erbil, which is planned to officially open in November.
Prime Minister Barzani congratulated Ambassador Molenaar on his new mission and discussed his hope of seeing increased cooperation and trade between the Kurdistan Region and the Netherlands.
The Ambassador said that the Dutch government is mindful of Kurdistan’s very good security, confirming that they are encouraging companies throughout the Netherlands to come and invest in the Kurdistan Region.
Both sides also discussed several strategic agriculture agreements that the two governments plan to sign in the near future, as well as the Dutch government’s intentions to open an agriculture bank in Kurdistan.
At the invitation of the Dutch Ministry of Foreign Affairs, the Head of the KRG Department of Foreign Relations, Minister Falah Mustafa, made an official visit to The Hague last week, meeting with a number of senior officials from the Dutch Foreign Ministry and speaking at a panel organised by the Ministry.
(Source: KRG)