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Nokia Siemens Confirms Sponsorship of Iraq Communications Summit
July 2th 2008
IDP
Preparations for the forthcoming Iraq Transportation & Communications Technology Summit have been further boosted following confirmation of attendance from Nokia Siemens, with the Finnish-German joint venture confirming its role as a key sponsor.
The summit will take place in Dubai on 9-10 October, organised in partnership with the Government of Iraq and welcoming a high level delegation of senior decision makers from Iraq’s Ministries of Transport, Communications and Science & Technology, including ministers, deputies and director generals.
Also in attendance will be the key state owned companies for these sectors, including the Iraq Communications & Media Commission and Iraq Telecommunications & Postal Company.
Iraq's communications infrastructure offers huge opportunities for global operators to work with the Government of Iraq, with a key area of focus being the expansion of Iraq's mobile telecommunications networks, the development of fixed line networks and public information technology systems.
Nokia Siemens are a leader in this expansion, providing perhaps the best example of the many lucrative commercial opportunities available in Iraq's communications sector, having recently signed a $150 million contract with Zain to modernise its mobile network. Nokia Siemens also recently extended its cooperation with the operator Asiacell, inking a multi-million dollar frame contract for its 2G network expansion.
These areas will form a key component of the summit, which is based on a unique format whereby half of the summit time is devoted to speeches and presentations and the other half devoted to one-to-one meetings.
These private meetings will provide a prime opportunity for operators and service providers to meet with senior officials from the Government of Iraq to discuss the opportunities available within the sector.
Baghdad's gas crisis to end in days- ministry
July 1th 2008
The gas crisis in the Iraqi capital will end in the coming few days after the completion of repair work on the main pipeline that feeds Baghdad's al-Doura refinery, an official spokesman for the Iraqi Ministry of Oil said on Monday.
"After repair work on the pipeline is completed, al-Doura refinery will resume operations," Issam Jihad told Aswat al-Iraq-Voices of Iraq- (VOI). The refinery has stopped working due to sabotage attacks that prevented the flow of oil four days ago. "Work is currently underway to fix the pipeline and will be completed in the coming few hours," the spokesman noted, explaining that the refinery supplies the capital with 2.5 million liters of gas a day. Since early this week, residents of Baghdad have been suffering from gas shortage, which prompted prices to rise significantly and forced local residents, who cannot afford black market prices, to line up in front of gas stations to fill up with gas.
Service projects in Baghdad's Sadr, Shula cities- spokesman
July 1th 2008
The Iraqi government's allocations for Baghdad's cities of Sadr and Shula were given in the form of service projects, a civilian spokesman for Baghdad's Fardh al-Qanoon (Law Imposing) plan said.
"The money allocated to the cities of Sadr and Shula was given in the form of service projects for local residents," Tahseen al-Shaykhali said during a Baghdad-based press conference on Sunday, adding that $10 million will be allocated for Sadr City's reconstruction following the devastation that resulted from recent military operations. Sadr City, the principal stronghold of Shiite Cleric Moqtada al-Sadr's Mahdi Army, has been a site of frequent confrontations between U.S.-backed Iraqi forces and gunmen believed to belong to the Mahdi army. In late March 2008, Iraqi security forces launched a wide-scale security operation in the city, which coincided with clashes that took place in the southern province of Basra. The confrontations lasted for over six weeks, after which the Iraqi government reached a truce with the Shiite cleric. Hundreds of civilians, gunmen and security personnel were killed or wounded in the clashes, which left Sadr City largely destroyed. Al-Shaykhali noted that 20 parks, 15 markets and a playground will be built in the city, in addition to 11 schools, on which work is currently underway. "A total of $10 million will be granted in small loans to residents of Sadr City to help them start small projects," the spokesman added. Commenting on the educational field, al-Shaykhali said that an anti-illiteracy program will be launched in cooperation with the International Council for Adults Education (ICAE). When asked about the gas crisis in the Iraqi capital, al-Shaykhali said that the crisis was the result of the closing down of some fuel stations due to maintenance work. Gas tank cleaning will last for a few days, after which all gas stations will reopen to the public, he said. Concerning al-Shula City, the spokesman said that Baghdad's municipality has launched a project to set up a water purification station, in addition to a sewage treatment plant, popular markets, an industrial compound, and three pedestrian bridges. Baghdad's western city of al-Shula witnessed fierce clashes that coincided with the incidents that occurred in Sadr City. Dozens of people were killed or wounded in the confrontations that took place between U.S. and Iraqi forces, and gunmen believed to belong to the Mahdi Army.
VP, agriculture minister discuss production problems in Iraq
July 1th 2008
Iraqi Vices President Tareq al-Hashemi on Monday discussed with Minister of Agriculture Ali al-Bahadli and a number of officials the problems facing the agricultural production in Iraq. Al-Hashemi told Aswat al-Iraq - Voices of Iraq - (VOI) that he visited the Agriculture Ministry, where he met with the minister and his two assistants; Subhi al-Jemeli and Mahdi Damad al-Qessi, to discuss problems and obstacles facing the ministry, mainly the reduction of the agricultural production in 2008. He did not add more details.
Details of Iraq's foreign debts
June 1th 2008
UN Secretary General Ban Ki-moon and Iraqi Prime Minister Nuri al-Maliki head a conference to drop Iraq's debts held on Thursday. The meeting aims to assess progress in implementing a plan approved last year to help rebuild the ailing economy of Iraq after five years of war. The United States is exercising pressure on the Sunni Arab governments to support Al-Maliki government through writing off the debts and open diplomatic missions.
The following are some details on Iraq's debts:
-- Over the last three years, Iraq was exempted from about $ 66.5 billion of the total foreign debts amounting to 120.2 billion dollars. With the participation of all members of the Paris Club, it dropped $ 42.3 billion including debts owed to Russia amounting to $ 12 billion dollars.
-- The Paris Club is an informal group of government creditors whose role is to help debtor countries to manage their debt.
-- A number of non-members of the Paris Club dropped a total of $ 8.2 billion of the debts, according to the Paris Club terms, while commercial creditors dropped $ 16 billion, according to the terms of the Paris Club as well.
-- Other members of the Club agreed to cancel 80 percent of Iraq's debts.
-- Estimates of the remaining debts:
$ 56.6 billion to 79.9 billion dollars include
Paris Club... 7.6 billion dollars.
Gulf Cooperation Council States... $ 32.4 billion to $ 55.4 billion.
Bilateral agreements outside the Paris Club... $ 646 million.
Other debts outside the Paris Club... $ 15.9 billion to $ 16.2 billion.
-- Debts dropped by some States:
United States... $ 4.1 billion
Japan... $ 6.8 billion
Germany... $ 5.6 billion
France... $ 5.1 billion
Russia... $ 12 billion
Italy... $ 2.4 billion
Bulgaria... $ 3.1 billion
Serbia, Slovenia and Bosnia... $ 2.2 billion
Romania... $ 2 billion
-- Saudi Arabia and Kuwait:
-- Last year, Saudi Foreign Minister, Prince Saud al-Faisal, said his country will cancel 80 percent of more than $ 15 billion owed them by Iraq.
-- In September last Ixave Musca, President of Paris Club, said that Saudi Arabia and Kuwait had not presented a report of Iraq's debts as done by the Paris Club in 2004.
-- The debt owed to Kuwait is about $ 15 billion.
Industry Ministry signs MoU with Swedish motor company
June 1th 2008
The Iraqi Minister of Industry and Minerals has signed a memorandum of understanding (MoU) with the Swedish motor manufacturer Scania to develop the General Company for Motor Manufacturing in Babel province, a ministerial statement said on Saturday.
"The memorandum was signed on the sidelines on the minister's participation in the 2nd International Compact with Iraq (ICI), held in Stockholm on Thursday with the participation of a huge delegation headed by the prime minister, his deputy and several ministers," read a ministerial statement received by Aswat al-Iraq.
The General Company for Motor Manufacturing is affiliated to the Iraqi Ministry of Industry and Minerals and is located in Babel provinces, which lies 100 km south of the capital Baghdad.
Tribes vow to protect oil pipelines in Diala
June 1th 2008
Iraq’s Oil Ministry spokesman on Saturday said that tribal leaders vowed to protect pipelines passing through Diala and any oil installations there from attacks. "Oil Minister Hussein Shahrestani met today with tribal chieftains from Diala province, and entrusted them to protect the pipelines and oil installations in the province against any attacks,” Asem Jihad told Aswat al-Iraq - Voices of Iraq - (VOI). He pointed out that "Shahrestani, on his part, pledged to appoint a large number of tribal fellows within the staff of the Ministry of Oil, and specifically in the facilities protection service (FPS), in order to the protect the oil pipelines passing through Diala." Jihad pointed out that the recruitment policy of entrusting tribal fellows to protect oil installations had proved successful in many regions of the country, especially in areas that were classified as hot spots. Iraqi oil installations and the network of pipelines transporting oil and gas have been exposed to sabotage operations that led to a significant decline in the capabilities of processing and export of petroleum products, as all efforts employed to provide protection to the pipeline failed, causing a passive impact during the past five years to provide fuel for power plants for electric power system.
A close agreement on oil and gas law
April 20th 2008
Iraqi Prime Minister, Nuri al-Maliki, said on Wednesday that Iraq is close from completing the oil and gas law, which is long awaited. He told a committee at the European Parliament in Brussels, during his there to discuss cooperation with the European Union on energy, "We are close to an agreement on a final version of the oil and gas law."
Vice president of the Iraqi parliament, Khaled al-Attiyah, warned on Tuesday that the Iraqi government and officials from Kurdistan region will resume talks soon to try to settle differences that hinder the passing of the bill. An Oil Ministry official said on Wednesday that the main reason for the delay is the contracts signed by the authorities of Kurdistan region.
Japan to build largest hospital in the city of Halabja
April 20th 2008
The Japanese ambassador of reconstruction projects in Iraq revealed on Wednesday that the Japanese government decided to build the largest hospital in the city of Halabja southeast of Sulaymaniyah and according to international standards.
Anu Sutee Karimato said, "This project is the first of its kind implemented by the Japanese government among its projects in Kurdistan region, and it would be announced of during the next week," without clarifying more details on the duration and cost of the project.
Imminent agreement on gas between Iraq and Europe
April 20th 2008
European Union says it is about to reach an agreement with Iraq over the next few weeks, according to which Iraq will provide the Union with gas and crude oil.
Iraqi Prime Minister, Nuri al-Maliki who is visiting Brussels, said that his country is about to issue a new law governing the oil-sector in Iraq and encouraging investment.
European officials said that Iraq would increase its production of oil, and promised to provide 5 billion cubic meters of natural gas to Europe as a sign of good faith. The European Union had announced last Monday that it has received promises to provide European countries with ten billion cubic meters of gas annually from next year.
It is noteworthy that Europe relies on Russian gas to satisfy only a quarter of its need of natural gas; it will also contribute in building a new pipeline to transport gas from the Turkish border. Europeans hope that the new pipeline (known as Nabucco) will transfer gas from Turkmenistan across Iraq and the Turkish territory to Europe; however, work on building Nabucco line will not begin before 2010, and it would convey only %5 of the European continent need for gas.
The gas which al-Maliki promised the Europeans will be extracted from the field (Ekas) in the western province of Anbar; Iraqi Oil Ministry had announced earlier that it was negotiating with Shell Company for oil to do the extraction tests on that field. On the other hand, al-Maliki demanded the Europeans to provide the necessary expertise to rebuild the productive and administrative bases for the oil sector in Iraq.
Opening the Fifth International Exhibition for Rebuilding Iraq amid an official Iraqi absence
April 19th 2008
The Fifth International Exhibition for Rebuilding Iraq opened in the Jordanian capital of Amman on Monday with the participation of more than 450 Arab and foreign companies amid the absence of Iraqi government representatives.
The opening ceremony was attended by the Jordanian Minister of Industry and Trade, Amir Al-Hadidi, who expressed his hope in the success of the exhibition, saying he expects that there will be considerable room for all companies to participate and contribute in the reconstruction of Iraq. He added that Jordan has and will continue to participate in the reconstruction of Iraq due to the close relationship between it and the Government and the Iraqi people.
In reply to a question on the impact of the absence of the Iraqi government, Al-Hadidi said that the private sector has a significant impact in the current economy of Iraq, pointing out that he did not know the reason for the absence of Iraqi ministers in concern in this exhibition. The security turmoil in Iraq have been the main obstacle facing investment in the country.
Iraq oil output to triple
November 10th 2007
Trade Arabia
Iraqi oil production should nearly triple in the next few years as it explores more areas and attracts investment, the former Iraqi oil minister said.
Thamir Ghadhban, who held the post from June 2004 to May 2005 and now advises Iraqi Prime Minister Nuri Al Maliki on oil and energy issues, said Iraq's government planned to increase production to six million barrels per day by 2015.
'Iraq is one of the least-explored countries among the major oil producers,' Ghadhban told an audience at Stanford University in California.
Iraqi oil production is currently 2.25 million barrels per day, slightly less than production during Saddam Hussein's rule. Exports are 1.7 million barrels per day.
Immediate objectives for increasing production included exploring the Kurdistan Federal Region, the western deserts and the Mesopotamian sedimentary basin, Ghadhban said.
Iraq also needed to develop single-buoy moorings in the Gulf and invite foreign investment, he added.
Iraq, a founding member of Opec, has the world's third-largest proven oil reserves at 112 billion barrels, with another 214 billion barrels of probable reserves.
Iraq’s 18 provinces get $30 million each
November 10th 2007
Azzaman
Iraq’s 18 provinces will get $30 million each to help reduce rampant unemployment in the country, according to the Minister of Labor and Social Affairs.
Mohammed al-Sheikh said the provinces were under obligation to use the money “solely for employment purposes.”
The money, Sheikh said, should only be disbursed for the start up of small businesses.
The project is hoped to eventually reduce the number of jobless in Iraq. At least 40 percent of Iraq’s working population is believed to be idle.
The ministry wants the money to be extended as part of soft loans and in a way that makes it easy for the beneficiaries to pay back.
Preferential treatment, according to the minister, will be given to unemployed university graduates and people who have lost businesses due to ongoing military operations in the country.
Employment centers have names of more than 1 million jobless Iraqis
November 10th 2007
Azzaman
Employment and training centers across the country have to deal with an army of jobless Iraqis whose numbers have recently shot to more than 1.2 million, a statement by the ministry of labor and social affairs said.
The massive jobless figure includes only those who have registered with these centers in the hope of finding a job.
Ministry officials estimate that the jobless figure maybe twice that number as many unemployed Iraqis simply do not bother to register with these centers.
The statement said only 101,890 names in the country’s bloating jobless books were women.
The figure also does not include the nearly two million Iraqi refugees almost all of them jobless who have fled to neighboring states.
ISX - Daily Analysis
November 10th 2007
Iraq Stock Exchange hold Fourth session for this month , the numbers of Traded Companies were (26)and still (24)companies are off Trading Floor because of their General Assembly meeting which they decided to Increase their Capital. ForToday the numbers of Traded Shares were (495) m/ shares and Trading volume (741) m / ID, the price Index was about 35.740 point .Bank sector Index was(36.350),Investment sector Index was(109.180),Services Sector Index was(77.320) , Industrial Sector Index was(11.361), Hotels sector Index (14.796). from the Bulletin we can see the Trading for (10) banks,(1) Investment,(4) Services Company,(9) Industrial companies, (2) Hotels company . Generally the shares prices were Increased in (2) Companies,Decrease in about (13) &stables in (11)
Baghdad International Airport business development opportunities expand with convention center, office suites
November 2th 2007
Business development opportunities will soon be expanded at the Baghdad International Airport complex.
The U.S. Army Corps of Engineers (USACE) is overseeing work to convert the two former domestic terminals into a modern convention center. In addition, an eight-story structure is being remodeled to offer 250 office spaces for lease.
"That convention center will have the capacity to handle gatherings up to 25,000 people," says USACE project engineer Matthew David. "It will include exhibition halls, offices, conference rooms, and a restaurant. We're putting in new plumbing, plastering, electrical, lighting, and air conditioning. It's located at the transportation hub of Iraq, a perfect location for such a facility." The two former terminals are both two-story structures, one measuring 53x138 meters, the other 31x150 meters. The $6.3 million renovation project is about 20 percent finished with a projected completion date of next spring.
Next door to the convention center is an eight-story 3,076-sq.-meter office structure. "Businesses will be able to come in and rent space as needed, from one office to several floors of offices. Work there includes new restrooms, electrical, fire protection with sprinklers, lighting, new ceilings, plastering, a new mechanical system including two 200-ton air conditioning chillers, office furniture, a lighted parking lot, and a cafeteria.
"Our Iraqi contractor is definitely interested in the mission of rebuilding Iraq and is taking extra steps to ensure that the office building will meet the needs of its customers," David said. Currently that $4 million project is about 30 percent finished with a projected completion date of April 2008.
Majed Michel, manager of the Baghdad Business Center located between the new Convention Center and the office building, says he is very encouraged by what these new facilities will offer Iraq.
"This will significantly enhance our economic development opportunities here. We're already planning our first trade show in the new convention center next spring that will focus on the oil industry. We're encouraging international companies to consider opening a satellite facility in the 'executive suites' office building here at the Baghdad International Airport. I'm very optimistic about Iraq's future," he continued.
"There are good people all over the world who I would like to encourage to visit Iraq and help us move forward. This is an historic opportunity. When you have cooperation among individuals, anything is possible." he added.
A fence between Saudi Arabia and Iraq
November 2th 2007
Documents obtained by Reuters showed that the two European companies E.A.D.S. and TALICE as well as the American company Raytheon are among the companies that submitted offers to build a border fence between Saudi Arabia and Iraq.
Saudi officials said last month that Saudi Arabia, the biggest oil exporter in the world, wants to build a fence of barbed wire of 900 km in length on its borders with Iraq and the installation of thermal imaging equipments and radar devices.
According to the list of companies obtained by Reuters, and was confirmed by three different sources, the groups comprising include 14 local and global companies made presentations at 28 of October for the implementation of the project.
The list also included Al-Seif Company for engineering and construction as well as Al-Arrab Contracting Company owned by Al-Rajihi Bank. There were also two companies made offers to implement the project and they are: the American company D.R.S. Technologies for defense equipments and the South Korean company L.G Electronics.
An official at Al-Seif Company, who asked not to be identified, said "There are several alternative options in the presentations because of the complex nature of the project. It is difficult to determine the value of the project." Two other contractors said that the project would cost about four billion riyals ( 1.07 billion dollars), and that it is part of a broader defense plan for securing the country's borders with the length of 5600 km.
Prince Nayef, the Interior Minister, said last year that the border fence has become a necessity because of the escalating violence in Iraq.
Saudi Arabia plans to enhance border security by adding hundreds of radar equipments, coastal monitoring stations, communication networks and reconnaissance planes in different parts of the country.
The cost of such a plan will be about 20 billion riyals (5.33 billion dollars), according to what was said by the magazine Middle East Economic Digest (MEED) last year.
Mubarrid' is participating in the exhibition of reconstructing Iraq
November 2th 2007
"Mubarrid" Company for transport announced its participation in the Exhibition of Reconstructing Iraq to be held from 4 to 7 next November on the ground of the international exhibitions in Musharraf under the auspices of His Highness the Crown Prince Sheikh Nawaf Al-Ahmad Al-Jaber Al-Sabah.
The Company said that its participation in this exhibition will be through its expertise in the area of transportation which is one of the foundations of building infrastructure and economic progress; the company presents a system of integrated logistic services, including road transport services of all kinds through a fleet of the latest equipments and sophisticated modern transport services, as well as air and sea freight through the company National Express, as well as its manufacturing of all types of trailers and semi-trailers through Babtin factory for the manufacture of automobile structures owned by "Mubarrid" Company for transport.
T.A.T. Oil comes back to Iraq
November 2th 2007
Russian Company "T.A.T. Oil" which used to work in Iraq in the period before the war, is having the opportunity to return to this country in the framework of cooperation with the American company Hyperion.
The American company has proposed to the Russian company to unify efforts to invest in heavy oil fields. The company Hyperion is a private company often operating in North America. There is information that it had begun work in Iraq.
"T.A.T. Oil" has tried to work in Iraq under an agreement reached to work in a number of oil fields in Iraq in the nineties of the last century; however, international sanctions have prevented this. " T.A.T. Oil" is implementing a number of projects outside Russia, in Libya and Syria, and it is studying the possibility of working in Sudan, Venezuela and expands its work in Russia. The company gives top priority to the extraction of heavy oil.
According to expert Demetri Lutiagin of "Phyllis Capital", the Iraqi State under the new law will use local companies to produce oil, which means that " T.A.T. Oil" must enter in cooperation with an Iraqi company along with the American company Hyperion.
The expert Constantine Riley of the company "Finam" said that work in Iraq is still fraught with danger.
Iraq Pumps Daily 600 Thousand Barrels of Oil form Kirkuk
October 6th 2007
PUK Media
A source said that Iraq pumped 600.000 barrel/day of Kirkuk’s oil to Turkey. ”Pumping is continuous by an average of 25.000 barrel/hour or 500 to 600 thousand barrels/day.” Navigational sources mentioned that Iraq has resumed pumping the oil through the northern pipes line to Turkey after it has been stopped for 10 days. The terrorist attacks stopped pumping of oil from Kirkuk fields to Jehan Harbor for several times since March 2003, and the last attack was in Sept. 19th. The source added that there are 3.7 million barrels of oil in the containers of Jehan Harbor, and this amount is available after loading an Oiler with an amount of 1.1 million barrels. Iraq soled by auction an amount of 5 million barrels in Jehan Harbor, which must be loaded on stages of 1-2 million barrels till Oct. 22nd, and it has soled earlier an amount of 2.5 million barrels to be loaded by Oct. 5th. It’s worth mentioning that Iraq’s major dependence is on exporting oil from al-Basrah Harbor, where an amount of 1.5 million barrels are soled daily.
Oil security improves, Iraq chief predicts
October 6th 2007
Security of the oil infrastructure in Iraq is to be less of a priority than the economic factors, Iraq's national security adviser predicts.
"Probably the last two years, one and a half years, we were talking about security, security, security," Mowaffak al-Rubaie said Friday at the Center for Strategic & International Studies, a Washington think tank.
Rubaie, in a mostly optimistic speech and answers to reporters' questions, said the trend in Iraq is that the security situation is improving, along with help and partnership with the United States.
"If we can sustain this level of security until the end of the year, I can tell you next year is going to be about services, services, services. Economy, economy, economy," he said. "And then security."
Iraq's vast oil and natural gas reserves have been hit hard by decades of misuse by Saddam Hussein, stunted by U.N. sanctions, and have survived thus far in the post-invasion war zone. While they need tens of billions of dollars in investment, the hydrocarbons and electricity sectors need a break from the regular attacks that are keeping out investment and hurting repairs.
"We are going to have more capital investment for next year in 2008 in the oil sector," Rubaie said. Iraq has been unable to turn capital allocations into expenditures, another setback.
He said he met with U.S. Energy Secretary Samuel Bodman while in Washington this week, and from the meeting produced a list of small "quick fix projects Â… to try to increase the number of barrels every day we get out."
"Protection of the pipelines and the infrastructure, gas as well as oil pipelines, as well as the power lines, these are issues we prioritize for next year," he said.
Iraq currently produces about 2 million bpd, though its reserves could handle much more. A five-year strategic plan has Iraq producing more than 6 million bpd.
That sector is pivotal," Rubaie said, "it's like the jugular vein for us."
Iraq mobile market forecast at US$1.5 billion
October 6th 2007
Business Intelligence
Research firm Research and Markets has announced the addition of a new report 'Iraq Telecommunications Market Opportunities, Strategies, and Forecasts, 2007 to 2013' to its offering.
The number of mobile subscribers in Iraq for the three largest companies is at 9 million users at the end of 2006, representing a mobile penetration rate of approximately 33%.
The market added a total of 1.36 million subscribers over the quarter to end-2006, representing the strongest number of user additions since launching service in December 2003.
There are a large number of operators besides the top three, operating outside the registered spectrum. Many of these are using a voice over Internet Protocol (VoIP) wireless local loop or WiMAX equipment.
The addition of 9 million subscribers in a little over three years is a significant achievement given the state of security on the ground in the country. Nationwide competition has been a positive development in the Iraqi mobile market with Iraqna having begun 2006 with over 40% market share, and losing share in each quarter of the year, to end the period with a 32.8% share among the top three cellular providers.
Iraq telco services markets at US$1.19 billion in 2006 are anticipated to reach US$1.5 billion for cellular systems iin 2013 and US$2.26 billion for wireless local loop systems.
This is the 319th report in a series of market research reports that provide forecasts in communications, telecommunications, the internet, computer, software, and telephone equipment. The project leaders take direct responsibility for writing and preparing each report. They have significant experience preparing industry studies. Forecasts are based on primary research and proprietary data bases.
Forecasts reflect analysis of the market trends in the segment and related segments. Unit and dollar shipments are analysed through consideration of dollar volume of each market participation in the segment. Market share analysis includes conversations with key customers of products, industry segment leaders, marketing directors, distributors, leading market participants, and companies seeking to develop measurable market share. Over 200 in-depth interviews are conducted for each report with a broad range of key participants and opinion leaders in the market segment.
The research has been carried out by leading analysts Ellen Curtiss and Susan Eustis.
Ellen Curtiss conducts strategic and market assessments in technology-based industries. Previously she was a member of the staff of Arthur D Little, for 23 years, most recently as Vice President of Arthur D Little Decision Resources, specialising in strategic planning and market development services. She is a graduate of Boston University and the Programme for Management Development at Harvard Graduate School of Business Administration. She is the author of recent studies on worldwide telecommunications markets and the Top Ten Telecommunications market analysis and forecasts.
Susan Eustis, President has done research in communications and computer markets and applications. She holds several patents in microcomputing and parallel processing. She is the author of recent studies on Internet equipment, worldwide telecommunications equipment, digital loop carrier, web hosting, and application integration markets.
Companies cited in the report include: MTC Atheer, Orascom, AsiaCell, Mobi-Tel, Qatar Telecom, Iraqi Telecommunications and Post Company, Etisalat, Air Broadband Communications, Alvarion, Airspan, Alcatel/Lucent, Aperto Networks, D-Link, Fujitsu, Huawei Technologies and Intel.
Basrah Cluster Pump Stations Renovation Bringing Reliable Power
October 6th 2007
News Blaze
In one of the U.S. Army Corps of Engineers largest electricity projects in southern Iraq, cluster pump electrical substations are being renovated in a $76 million effort to help increase oil field production in the North Rumaylah Oil Field.
"The Basrah Cluster Pump Stations are 10 electrical substations in total. They are a part of the overall oil infrastructure and one of the biggest and most costly challenges," said Shawn Russell, deputy regional manager with the Gulf Region Division electricity sector.
The aim is to bring reliable power to the water injection facilities located within the North Rumaylah Oil Field and help increase Iraqi oil production, Russell said. "The projects are rehabilitated the existing substations which had been severely looted and damaged during the 1991 and 2003 wars."
Russell said that while these substations are important elements of the Rumaylah oil field infrastructure, they will also provide employment opportunities and further the economic development not only of the Basrah area but the entire country. "An important component of each project is the training of operations and maintenance personnel," he said. The training will develop individual's skills and increase the Iraqis' ability to sustain the facilities.
Army Maj. Rick Smith, operations officer with Basrah Oil Area Office, Gulf Region South district said the rehabilitation of the 10 cluster pump stations electrical systems is the biggest USACE electrical project in the Southern region of Iraq.
"USACE is working on various projects to ramp up oil production for Iraq and help improve its economy," he explained. "Right now Iraq has the world's second largest proven oil reserves. According to oil industry experts, new explorations could probably raise Iraq's reserves to 200+ billion barrels of high-grade crude, extraordinary cheap to produce."
Tom Eidson, chief of Engineering and Construction for the Gulf Region South district said,
"Improvements at these projects help in the recovery of oil infrastructure and contribute [ to the nationwide production capacity of ] 3 million barrels of crude per day.''
Work consisted of general maintenance, replacement of damaged transformers and switch gear, and building new control rooms, high voltage switch gear rooms and guard houses, he said.
Eidson explained that the main objectives of the rehabilitation projects are to create a strong and reliable source of income for Iraq, improve Iraqi living conditions and create new opportunities for employment. The project also hired local villagers which helped them make money for their families.
Smith said that "Iraq's economy is dominated by crude oil production and GRS has been working to improve the country's ability to enhance oil production through the renovations of key components of the oil infrastructure.
"Basrah is the second largest city in Iraq and Iraqi officials and oil experts believe that completing the reconstruction of oil infrastructure will put the province into competitive alignment with similar Middle East cities," he continued.
"We are making a big difference here in Iraq," Smith said "This country was war torn for more than 25 years and the people are tired of it. They want their freedom; they want to be self sufficient. We are putting the country back together to self govern."
Basra oil fuels fight to control Iraq's economic might
September 18th 2007
Christian Science Monitor
Basra, Iraq - It could be an "empire," says one Shiite militia leader. For the provincial governor, Basra's future is shimmering skyscrapers. He wants the Iraqi port city to be another Arab metropolis, perhaps the next Dubai.
Many Iraqis – businessmen, criminal bosses, militia commanders, political leaders – have designs on the city, that is vitally important to Iraq's national economy.
With its oil proceeds, Basra Province provided Baghdad nearly 90 percent of its budget of $40 million this year. And there is more money to come, if Iraq fully repairs and expands its war-ravaged oil infrastructure. Basra sits on some of the world's largest untapped reserves. In fact, the bulk of Iraq's estimated 200 billion barrels in potential deposits are here.
The fight for a stake in Basra's riches is often desperate and violent. Whoever comes out on top, they will hold great sway over the country, and much influence in the Middle East. Now that British forces have left Basra city, and are preparing for a full withdrawal from Basra Province by year-end, many Basrawis worry that this fight for control of Basra's petroleum wealth will further increase, perhaps growing into an all-out war.
Militias vie for control
At the entrance to the headquarters of the South Oil Company (SOC) in Basra, a sign dating from when Saddam Hussein nationalized the oil industry in 1972 reads: "Our oil is ours."
Inside, an exasperated senior official, who did not want to be identified for fear of retribution, describes the onslaught by parties and militias intent on controlling the company by forcing their loyalists into key management positions. Some are beholden to the Ministry of Oil in Baghdad, which is controlled by the United Iraqi Alliance (UIA), the dominant Shiite coalition to which Prime Minister Nouri al-Maliki belongs.
"There is an invasion by parties and militias … we are a mouthwatering prize," he says, adding that recently 8,000 people, most of them illiterate, were pushed on to the company's payrolls.
The power plays extend to Basra's ports, too, often contributing to anger and a sense of injustice among the province's estimated 3 million people. In the town of Abu Al-Khaseeb, south of the city, the newly rich are building palatial homes next to mud huts. The mansions often belong to those who have been able to cash in on the brisk business in the town's Abu Flous port, which is one the province's main four ports and is widely considered to be controlled by the mafialike family, Bayet Ashour, and certain militias.
"You can only work at the port if you join a militia. I thought about it, but then my two cousins who had joined were badly wounded in a clash. So now we just sit home and shut up," says resident Jalal Ali.
Last month, armed tribesmen forcefully brought oil production to a standstill at the Majnoon oil field, 38 miles north of Basra city, after the SOC refused to meet their demands for jobs in the area. An official at the company, which controls oil exploration and production throughout southern Iraq, confirmed the incident.
Many are also profiting off the oil by tapping right into the pipelines.
SOC's oil pipelines are regularly sabotaged and drilled into to steal crude and smuggle it outside Iraq, says the unnamed official at the company. Many in the province even accuse Gov. Muhammad Mosabeh Waeli's Fadhila Party, whose partisans dominate the oil protection force, of colluding with the smugglers. Mr. Waeli has vehemently denied the charges, calling them "a smear campaign orchestrated by pro-Iranian parties." $90 billion daily
SOC, which employs more than 30,000 people, is in charge of oil production and exploration in an area of about 45,000 acres in southern Iraq. By most estimates, potential Iraqi reserves account for nearly 16 to 20 percent of Middle East reserves. "Producing at full prewar capacity, Iraq can generate about $90 million a day through exports to support its own reconstruction," says a US Army Corps of Engineers slide presentation dated July 2004. "Immense potential exists to generate prosperity, employment, and economic stability for all Iraqis."
Production at the time the presentation was made was about 2.35 million barrels per day (b.p.d.). Exactly three years later, in July 2007, it stood at 2.1 million b.p.d., of which 1.8 million b.p.d. is from the south alone. About 1.6 million b.p.d. of this oil was exported exclusively via Basra terminals.
In order to regain the estimated 3.8 million b.p.d. reached in 1990, $2 billion to $3 billion of investment would be required over three years to rehabilitate existing oil fields and infrastructure, according to Muhammad-Ali Zainy, a senior oil economist and analyst at London's Center for Global Energy Studies.
Mr. Zainy blames the state of Iraq's oil industry on insecurity, corruption, government incompetence, and unfinished work by the US company KBR (formerly Kellogg Brown and Root), which was hired after the US-led invasion to do the engineering work to ramp up production.
He says the Ministry of Oil was allocated $4 billion last year, but spent perhaps only 3 percent of it on rehabilitation.
"There is chaos now in Basra. In this environment you cannot do real work. The [central] government itself run by religious parties is not going to be able to provide the proper environment for rehabilitation of the infrastructure, let alone investment," says Zainy, who is a native of the holy Shiite city of Najaf and was once a senior official at the Ministry of Oil before defecting in 1982 to escape Mr. Hussein's regime.
The southern branch of the General Oil Products Company, which is charged with refining and distributing oil products, is also said to be now under the sway of militias, according to several officials. But that tends to provide little protection from the militia's criminal rivals.
A few months ago, 90 fuel trucks, each with a capacity of 36,000 liters, pulled up at one of the company's depots. They filled up. But it turned out they were smugglers, not legitimate fuel distributors, according to a manager at an oil products transport company.
Zainy says Baghdad has its priorities upside down. It's making a mistake by "rushing" to approve a new oil law, which would open up the sector to foreign investors, as urged by Washington. Instead, he says, Baghdad should first focus on adding value to the sector by increasing production, stamping out corruption and theft, and re-creating the Iraqi National Oil Company, which was disbanded by Hussein in 1987 as an alternative to bureaucratic meddling by the Ministry of Oil.
"The timing is wrong … they are rushing to have the oil law ratified just in order to please the American administration," he says.
In what promises to be a major challenge for the controversial bill being debated in parliament, the industry's main labor union based in Basra says it will order a general strike should the oil law pass.
"We believe one of the main reasons America invaded is oil," says the union's head, Hassan Jumaa al-Assadi. "The law does not serve the people of Iraq but the US administration. History will not be merciful to those who vote for this law." Revitalization stalled
The struggle over power and resources – which extends to the halls of government in Baghdad – means that any prospect for Basra's riches being used to lift millions of Iraqis out of their misery and give jobs to disaffected youth remains a fiction.
"There is great deprivation and high unemployment. Plants are destroyed. The last 30 years for Basra have been 20 years of war followed by 10 years of economic deprivation," says Hamid al-Thalemi, a member of the local provincial council, who belongs to the secular party of former Iraqi premier Iyad Allawi.
Basra's infrastructure and economy suffered greatly from the impact of the devastating eight-year war between Iran and Iraq in the 1980s that was followed by the Gulf War in 1990.
"The government has no economic development strategy … the government is helpless … it's a catastrophe," adds Mr. Thalemi.
Agriculture and industry are in ruins, and many infrastructure projects such as water and sewerage repairs remain unrealized. Even the once-thriving date business is barely operational, although the province has the highest density of palm trees in Iraq, according to Thalemi.
Britain has pledged about $1.5 billion for reconstruction in Iraq with some of this money spent in Basra, where the last contingent of its troops is still stationed. They laid water pipes at a cost of $18 million and partially repaired electricity transmission and distribution networks, among other projects.
In the meantime, the city's main hospital is dumping its waste in the Shatt Al-Arab waterway every day. The nearby Al-Bardhia station, one of the city's main water plants adjacent to the palaces vacated by the British, pumps that water to residents. "This is a major crime, people are drinking this water," says Thalemi.
Growing tribal dissent
Inside a tribal guesthouse in the village of Zraiji, sandwiched between the Majnoon and Nahr Omar oil fields, elders from the Bani Malik, a major tribal confederation, gathered late last month to discuss the trouble at Majnoon oil field and voice their anger at the Shiite Islamist parties that rule the province and the country.
Sheikh Manie al-Maliki spoke first, recounting how he was approached by other tribes in the area to join them in stopping work at Majnoon. He refused because they threatened violence and sabotage. "We do not want to descend to that level and that's why we are sidelined," he says.
His village of 3,000 desperately needs the jobs, with only seven of its men employed in oil facilities protection, a 15,000-strong force dominated by partisans of Waeli. The elders say they derive no benefit from oil riches, but also their agricultural lands are fallow and need rehabilitation because they were battlefields in the Iran-Iraq War.
Now, they accuse provincial and central authorities in Baghdad of cronyism, corruption, and incompetence. Most say they regret having voted in 2005 for the UIA and say they were tricked by the party's appeal to sectarian passions and considerations at the time.
"It was nothing but empty promises. Anything built on sectarianism and cronyism does not work," says Sheikh Manie. "Turbaned clerics sat here, and we are simple people, and they started telling us the marjaiya [Shiite religious authority] wants this."
Another elder is blunter. "They are gangs, not political parties," he says.
Standing on the edge of Zraiji at sunset, one can see and feel the flames from the smokestacks, burning the precious natural gas that is extracted with oil from the Nahr Omar fields. They are a vivid reminder of Iraq's untapped, and often wasted, potential.
Economic development conference for Anbar
September 15th 2007
The clan leaders in Anbar held an economic conference with American and Iraqi officials to discuss methods of economic development, three days after the surprise visit by the American President. About three thousand American and Iraqi soldiers participated in protecting the Ramadi City Hall where the meeting was held over one day.
The conference was attended by Democratic Senator Joseph Biden who came to Iraq specifically to attend this forum. Also attending were the American ambassador in Baghdad, Ryan Crocker, and the Lieutenant General Ray Odierno, the second highest American military official in Iraq, in addition to a delegation from the Iraqi government headed by the two Vice-Presidents, Tariq Al-Hashemi and Adel Abdul-Mahdi, plus Deputy Prime Minister Barham Salih.
An American official said that the aim of this conference is to give economic support to this province where former rebels have joined the police to fight Al Qaeda alongside American forces.
Noah Miller, the official at the American embassy, said that "the Anbar Forum is an attempt to bring together the central government with local government," and added, "During this forum we expect the central government to announce an assistance program for the province."
The American President George Bush had made a surprise visit to Al-Assad air base in the province, and has hinted during his visit to the possibility of reducing the number of American troops in Iraq if the security situation continues to develop there, in what had been one of the main strongholds of the insurgency in Iraq.
Iraqi securities market Index drops 1.6%
September 15th 2007
The session of the Iraqi securities market on Sunday, the fourth this month, witnessed weak investor attendance; the meeting was delayed by a quarter of an hour until the arrival of brokerage companies and approved bank mediation offices to execute investor buy/sell orders.
The market bulletin showed that over 399 million shares worth over 529 million ID were traded in 184 contracts.
VOI: "The market price indicator dropped 1.6%, compared to the previous session, and settled at 38.95 points at the end of the session; most of the circulation has been in the banking sector, which ... traded 305 million shares valued 473 million ID; no contracts were executed for non-Iraqis in Sunday's session. Shares of 31 shareholding companies listed in the Iraq market for securities were traded: 12 of them for a Banking company, 2 an investment company, 3 to a service company, 12 for industrial companies and 2 a hotel company.”
Shares of 6 of the 12 banking companies traded increased, namely: the Bank of Mosul 9% (the highest of Sunday's session), the Islamic Bank 5%, Sumar Commercial Bank 4.7%, the Gulf Bank 3.5%, the Iraqi Commercial Bank 3% and the Bank of the North 1.2%. Prices of five decreased: the Iraqi National Bank by 8.3%, the Bank of Basra 4%, the Bank of Babel 3.7%, the Iraqi Investment Bank 3.5% and Alwarkaa Bank by 3.1 %; the Iraqi Credit Bank was unchanged, as was the banking index at 37.609 points.
Over 305 million (90% of the total number of shares traded) were bank stocks, at a value of over 473 million ID, 89.5% of total trading volume, with 130 trades. Al-Warkaa Bank had the highest share volume in the banking sector (24.8%) and the highest percentage of banking sector value (25%), with 75 million shares worth over 118,000,000 ID.
In the investment sector, the shares of two investment companies attracted high prices: Al-Wiiam for Financial Investment rose 4.1% and Al-Qimmah for Financial Investment 3.4%. The investment sector index closed at 108.570 -- plus 0.092% from the previous meeting.
In the services sector, three companies traded: Al-Badia Company, public transport, rose 5%, while the Iraqi Company, land transport, dropped 5.3%. Al-Maamoorah Real Estate Company was unchanged, as was the services sector index at 77.938.
Shares of 12 industrial companies traded Sunday; two increased: Baghdad Company for Carbonated Drinks by 4.3% and Electronic Industries Company 3.1%. Seven companies decreased: Al-Hilal Industrial Company, 7.6% ; the Company of Metal Industrial and Motorcycles, 5.8%; Eastern Beer Company, 5.5%; Al-Kindi Company for Veterinary Vaccines 5%; Modern Dyes Company 4.7%; Light Industries Company 3.4%, and finally the Chemical Industries Company by 2.6%. 3 firms were unchanged: Nineveh Company for Food Industries, the Carpets Company and finally the Iraqi Company for Engineering Works. The industrial index closed at 11.834 points, down 0.429%.
Baghdad Company for Carbonated Drinks had the highest share of the volume, (58.7%), and value, (50.7%), in the industrial sector with 11 million shares trading for over 13 million dinars.
The final outcome of Sunday's session showed 31 out of 93 listed companies traded; prices of 11 rose, 14 dropped and 6 were unchanged.
Bahrain hosts Iraqi forum in November
September 15th 2007
Ghassan Hussein, Iraqi ambassador to Manama, said that Bahrain will host the first Iraqi-Gulf Forum and Exhibition on Iraqi Reconstruction this November. He stressed that consolidating relations with Bahrain is a priority of the Iraqi embassy there, expressing thanks to King Hamad Bin Issa Al Khalifa for kind gestures towards the treatment of Iraqi children and training of various Iraqi cadres.
He added that Iraq's oil and economic policies led to improvements despite deteriorating security, confirming that Bahraini investors have already invested, especially in the region of Iraqi Kurdistan which enjoys the highest level of security.
The Iraqi ambassador said that choosing Bahrain to hold a forum and exhibition is of great significance for the deepening relationship between the two countries, and that the Bahrain event is the first stage toward the success of other Gulf States forums. He expected that 2000 Iraqi businessmen and officials will attend the forum as there are many positive responses to this Conference, which is supported by the Bahrain Chamber of Commerce and Industry and the Bahraini-American Chamber of Commerce.
The Iraqi Forum was supposed to be organized last March but the States were not ready then, so it was postponed to November. Many nations have announced participation, notwithstanding that the Iraqi community in Bahrain does not exceed 1400 persons according to an earlier press statement by the Iraqi ambassador to Manama.
Al-Rafidain Bank capital increased to 25 billion dinars
September 14th 2007
The Cabinet decided at its thirty seventh regular session to approve the capital increase of Al-Rafidain Bank from ten billion ID to twenty five billion ID from the reserve account without incurring treasury charges, based on the provisions of Article (10 / First paragraph) of the General Companies Act No. 22 for the year 1997 as amended by Law No. 9 for 2002.
Iraq's 2007 Economic Growth to Exceed Six Percent
September 9th 2007
Turkish Weekly
A senior U.S. official says Iraq's economy is likely to grow more than six percent this year thanks to improving security in the country. But U.S. diplomat Charles Ries also says the Iraqi economy is underperforming because of an inadequate supply of electricity, and weakness in the oil sector. Ries was speaking Wednesday in Baghdad, where he is serving as the U.S. coordinator for Iraq's economic transition. The International Monetary Fund (IMF) said in a report last month that Iraq has struggled to raise oil production above the current two million barrels a day. Ries says Iraqi oil production will increase once the parliament passes legislation to share oil revenues between Iraq's Shi'ites, Sunni Arabs and Kurds. He says such a law will enable foreign energy companies to help find new oil and gas deposits in Iraq. Iraq has the world's third largest proven oil reserves, with much of the country still unexplored. The IMF has predicted Iraq's economy will grow 6.3 percent this year, slightly up from 6.2 percent in 2006.
Iraq needs $20-25 bln for refineries-oil official
September 8th 2007
Reuters
Iraq will require up to $25 billion in investment to expand its refining capacity over the next five to seven years, an Iraqi oil official said on Saturday. Dathar al-Khashab, director-general of the state-run Midland Refineries Co, said that estimate included expanding Iraq's five existing refineries and building four refineries, as well as the cost of crude pipelines, product pipelines and depots. "The huge surge of prices in construction costs means this figure could be moderate," he said on the sidelines of a conference in Dubai. "This could be done from internal financing and the other way is through joint ventures, inviting international companies to come in and offering a lot of incentives to do so." Iraq has the world's third-largest proven oil reserves but its refineries have suffered from a decade of sanctions and four years of violence since the U.S.-led invasion of 2003, which has hampered investment. In 2002, Iraq had total installed refining capacity of some 590,000 bpd, operating at 90-95 percent, Khashab said. The refineries were operating at 60 percent in 2005, when Iraq suffered a gasoline shortage of 10-12 million litres, he added. While that has eased, Khashab said, demand was likely to rise again if the security situation improves. The shortages have already resulted in a thriving black market in fuel. Khashab said each of the existing refineries, would cost $1.5 billion to expand. Plans were also afoot for the construction of a new 300,000 bpd refinery in the southern city of Nassirya and three 150,000 bpd refineries in Amara, Kerbala and Kirkuk, though the projects are mostly still at the consulting stage. "The one in Kerbala we have done some engineering on and the FEED package is going to be tendered in the next few weeks," he said. "We are having problems with the new pricing. The main thing that is hampering us is the misunderstanding from companies... It is not like before. We are now transparent." Some foreign companies have been wary of entering Iraq amid daily violence, a lack of transparency and a legal vacuum in some areas. Many international oil companies are awaiting the passage of a new federal oil law that will regulate the sector. The much-anticipated bill has been approved by the government after months of talks but has yet to be passed by Iraq's parliament.
Iraq seeks oil output of six million bpd within decade
September 8th 2007
Iraq is aiming to raise its oil output to three million barrels per day (bpd) next year and to six million bpd within a decade, Oil Minister Hussein Shahristani said on Saturday.
The plan is to hike production "from just under 2.5 million bpd to three million bpd by 2008 and 3.5 million bpd by the end of 2009," Shahristani told the opening session of an "Iraq Petroleum 2007" conference in the United Arab Emirates.
Iraq then hopes to boost output to six million bpd 10 years from now, Shahristani said.
He said that to reach the targets, Iraq needed to improve its export infrastructure by building new terminals in the Gulf as well as new pipelines to neighbouring countries, including to the east, to Iran.
Iraq's oil infrastructure has been hit by decades of under-investment as a result of successive Gulf wars, 13 years of UN sanctions and the rampant insecurity that has followed the US-led invasion of 2003.
On gas, Shahristani said the medium-term aim was to increase existing reserves of 3.1 trillion cubic metres (109.5 trillion cubic feet) to 4.6 trillion cubic metres (162.4 trillion cubic feet) through intensified drilling efforts.
He said he was confident that a long delayed oil and gas bill would be approved by parliament in its coming session.
"I think the law is going to be passed. Of course, there will be some adjustments (and) amendments ... There is a sufficient majority in parliament to pass the law," he said. The heavily contested bill includes measures to open up the long state-controlled hydrocarbons sector to foreign investment as well as reassure all of Iraq's warring communities that earnings will be shared fairly across the country.
Iraq's oil reserves are largely in the Kurdish north and the Shiite south, and Sunni Arabs from the central and western regions have expressed fear that they could lose out if growing calls for a less centralised form of government are heeded.
Washington regards passage of the draft legislation as key to efforts to woo the disenchanted Sunni Arab elite away from the anti-US insurgency and back into mainstream politics.
But the measures to loosen state control of Iraq's main natural resource have drawn strong opposition from nationalists and left-wingers who charge that Washington is abusing its military presence to plunder the country. Shahristani insisted that foreign investment was vital if Iraq was to realise the vast potential of its oil and gas wealth.
"Some 50 discovered fields await developers," he said, adding that Iraq aims to intensify exploration to increase its proven reserves from the current 115 billion barrels to 160 billion.
Washington has been pinning its hopes for recovery in Iraq's war-ravaged economy on a takeoff in the oil and gas sector.
An August report from the International Monetary Fund said that growth had been slower than expected "mainly because the expected expansion of oil production has not materialised."
Shahristani insisted that a drawdown under way in coalition troop numbers around Iraq's key southern oilfields and export terminals would not affect their security.
"The pullout of the British troops or any other troops has no impact on our oil industry, simply because these troops have never been protecting our installations," he told reporters.
"American or British or any other troops have never been protecting our oilfields or installations... We have our own protection."
Britain announced on Saturday that 250 of its remaining 5,500 troops in southern Iraq would be withdrawn over the next four weeks with another 250 to follow them in the coming months.
Iraq Kurdish region signs oil deal with U.S. Hunt
September 8th 2007
The government of Iraq's Kurdish region said on Saturday it had signed a gas and oil production sharing contract with a unit of U.S.-based Hunt Oil Co. and with Impulse Energy Corp.
The deal covers exploration activity in the Dihok area, and Hunt Oil Co. of the Kurdistan Region will begin geological survey and seismic work by the end of 2007 and has plans to drill an exploration well in 2008, a statement from the Kurdistan Regional Government said.
Iraq business conference opens in Dubai
September 2th 2007
Arabian Business
Businessmen from southern Iraq met with international counterparts yesterday to discuss business and investment opportunities in the war-torn country.
Vice president of Iraq Dr Adel Abdul Mehdi opened the first Iraq Business and Investment Conference in Dubai.
Panel sessions covered the legal environment for conducting business in Iraq, financing private sector business, trade, and commerce and private sector banking.
According to Mehdi ‘Iraq's new investment law will facilitate investment for both Iraqi and non-Iraqi businesses by providing a secure investment environment. Business people know the capacities and resources of Iraq. These delegates are the experts brought together at this conference to present opportunities for investments across a wide range of industries. Iraq is not only oil and gas but also agriculture, infrastructure and tourism, both historic and religious.'
Five Iraqi government ministers are also attending the conference.
Sessions include presentations concerning joint ventures with state owned enterprises, investment in agriculture, free zones, construction and contracting and opportunities in reconstruction and management associated with the port of Basra.
Shell in talks over $2.1bn Iraqi project
September 2th 2007
Shell is in talks with the Iraqi Government about restoring and expanding a chemical plant near the city of Basra in a $2.1 billion (£1.1 billion) project, it emerged today.
Fawzi Hariri, Iraq’s Industry Minister, revealed that the terms of an agreement with Shell and the US giant Dow Chemical could be concluded by the end of the year.
He told Reuters: “We are looking to upgrade this [plant], and evaluate what type of products and facilities we need for the local market and beyond.”
The move is the latest sign that the world’s biggest energy companies are poised to begin the long-expected rush into Iraq after months of speculation.
Earlier this month, Total and Chevron signed an agreement to work together on projects in Iraq, including plans to improve production at the giant Majnoon oil field, the fourth-biggest in Iraq.
Shell has persistently denied any suggestion that it is engaged in talks regarding any official project, instead reiterating that it only hopes to help once the political and security situation improves.
But industry experts have long claimed that the Anglo-Dutch group is drawing up development plans for Rumaila, Iraq’s biggest oilfield. A spokesman was not immediately available for comment today.
A spokesman today said: "Shell has a very long history of working in Iraq. We would welcome the opportunity to help Iraq rebuild its energy industry, but we will only enter the country once security, living, and working conditions are improved.
"We are looking at opportunities from outside the country but have no comment to make on this particular project."
Iraq holds an estimated 110 billion barrels of oil, with more than half still to be developed, offering huge opportunities to Western companies desperate for new reserves.
Muhammad-Ali Zainy, a former oil official in the Iraqi Government, told The Times earlier this month: "Iraq is the last remaining frontier that offers so much potential."
1300 loans for industrial projects in Baghdad
September 1th 2007
An official source at the General Directorate for Industrial Development, a subsidiary of the Ministry of Industry and Minerals, said that the Directorate granted nearly 1300 loans for small and medium industrial projects for the industrialists of Baghdad as a result of Cabinet's allocation of $20 million for facilitated loans to support industrial enterprises in the private sector.
As the source explained in a statement issued by the Ministry of Industry and Minerals, “The loans ranged between ID10 and 25 million dinars for each project across all industries, with repayment over four years at 2% interest," but didn't specify when they were disbursed.
The statement added that "these loans apply to just 20% of the total enterprises registered in the Directorate in Baghdad, with eight thousand fully incorporated industrial projects in its database of detailed and exhaustive information."
He explained that there is a specialized committee within the Directorate of Industrial Development called the Federation of Industries and Internal Ministry Inspection which scrutinizes information provided by the owners of those projects in conjunction with existing Directorate data. The Directorate ceased distribution of applications for the loan program, begun last April 29, after it reached nearly two thousand forms.
Iraq Mobile phone market is expected to grow
September 1th 2007
Iraqi Minister of Communications, Mohammed Allawi, said on Thursday that the three mobile phone service company licenses just granted will strengthen the cellular network throughout the country, which relies on mobile because of the war and compromised ground lines.
Iraq auctioned three 15-year licenses on Friday for $3.75 bn. The licenses went to: the Kuwaiti Mobile Telecommunications Company (MTC), Asia Cell Company for Qatar Telecom Company (Q-Tel), and Kork Telecom Company of Irbil in Iraq's Kurdistan region.
Allawi said in an interview in Amman that the most important achievement of all was the opening of Iraq between all mobile phone companies, so that there now will be links between the networks. He added that the limited size of the fixed-line network of 1.2 million lines in a country with a population of 26 million pushed the use of mobile phones to more than 30% of total subscribers, or about eight million in about three years. He said that the new licenses will strengthen coverage even more.
He said the three companies with temporary licenses ( Egyptian Oras-com, MTC and Asia Cell) failed to provide adequate country-wide coverage, but that under the new licenses, the Kuwaiti company MTC could expand its network beyond the regions of central and southern Iraq. Similarly, Kork Telecom Company, operating from the other end of Iraq in Iraqi Kurdistan since 2001 under a local license, could also expand throughout Iraq.
The Iraqi minister said that Kork Telecom was in a suitable position to the acquire Oras-com Telecom operations, which withdrew from the auction because of the high bids; it was the first company with full mobile service after the U.S. occupation in 2003, through subsidiary Iraqna.
He added that the strong competition between the five bidders raised auction offers $1.25 billion, exceeding the government's expectations and reflecting the attractiveness of this mobile phone market.
He also believed that the expected investments in fixed lines will raise the number of lines to three million over the next three years.
Allawi added that the new licensing included stricter conditions to be signed formally at the end of this month to encourage more investment in services. He explained that the companies have to strengthen infrastructure now to a high level to provide good service, and competition will provide greater incentive for large investments.
The Iraqi Minister of Communications said that as the old licenses were of limited duration the performance had been weak since the companies did not want to spend money on infrastructure, but this should change now.
Iraq awards mobile licences
August 18th 2007
Financial Times
Iraq on Friday sold three mobile phone licences for a total of $3.75bn, replacing short-term contracts awarded after the US invasion.
The 15-year licences were given to three of four incumbent operators – Kuwait’s Mobile Telecommunications (MTC), and Iraq’s Asiacell and Korek - for $1.25bn each.
Telecoms has proved to be one of the profitable businesses in Iraq, with 8m mobile users predicted in the country by the end of 2006, which had grown from virtually zero before the war.
Bayan Jaber, the Iraqi finance minister, said it was estimated that the licenses would will bring the government total revenue of about $8bn over 15 years.
“To get the best return from the auction in such circumstances is a great vote of confidence in the Iraqi economy,” he said.
Orascom Telecom, the Egyptian company that operates the Iraqna network and was the first company to set up a full mobile service in Baghdad, withdrew from the bidding, which Mr Jaber said was a surprise.
Orascom pulled out when the bids reached $1.25bn, while Turkcell, the Turkish mobile operator, withdrew when bidding reached $800m, he said.
Wael Ziada, a telecoms analyst at EFG-Hermes, the Cairo-based investment house, said the licenses’ high price and an increase in the revenue share with the government from 13 per cent to 18 per cent were likely to have made the licenses unattractive to Orascom Telecom.
He said the three successful bidders would look to use the more stable licensing terms to increase investment and attempt to increase the market more rapidly but added that the security situation would be central to determining their success. Asiacell began operating in the Kurdish north in 1999. Korek Telecom is based in Irbil in Iraqi Kurdistan. MTC has the licence in southern Iraq.
Calls for leaving Iraq to help economy
August 18th 2007
UPI
Campaigning in Iowa for the Democratic presidential nomination, New Mexico Gov. Bill Richardson promised to restore fiscal responsibility if elected.
A statement released by Richardson's campaign organization Friday said the governor "believes fiscal responsibility begins with getting all of our troops out of Iraq and leaving no residual forces behind."
Richardson said he would repeal the Bush administration tax cuts, which Democrats have claimed help only the wealthiest Americans, and slash both congressional earmarks and corporate welfare.
"We can balance the federal budget and avoid passing on debt to our children," Richardson said.
He said he would use the money saved to eliminate the alternative minimum tax, establish a rural jobs tax credit for employers in less populous areas, provide a tax credit to companies that pay workers more than the prevailing wage and promote jobs in renewable energy.
Richardson also suggested indexing the minimum wage to inflation.
Singapore and Iraq - Contrasts in Water Management
August 18th 2007
Asian Tribune
As the world faces new threats of water scarcity, triggered by phenomena like global warming and bioenergy demands, Singapore and Iraq have been singled out as two political extremes in water management.
Singapore, the tiny city-state of 4.5 million people, has been touted as a phenomenal success story despite the absence of any natural resources. Iraq has been dismissed as an abject failure, despite its access to two major rivers within its borders.
Singapore's widely-acknowledged achievement in water management earned the South-east Asian nation the Stockholm Industry Water Award at an international water conference which concluded here Friday.
"We have ensured that our water supply is sustainable for the next 100 years, or more," says Khoo Teng Chye, chief executive of Singapore's national water agency.
This would have been unimaginable in the 1960s and 1970s, he said, when Singapore faced all the problems of rapid urbanization: water shortage, polluted rivers and widespread floods.
"The rivers were cleaned up in 10 years. The Singapore River became pollution-free and is teeming with fishes," he said at the award ceremony at the week-long conference sponsored by the Stockholm International Water Institute.
A country that once depended primarily on neighboring Malaysia for its water, Singapore now has three additional sources: collection of water from local catchments known as the Four National Taps, as well as water recycling and desalination.
Singapore's four recycling plants alone produce 15 percent of the city-state's water needs, with a fifth in the pipeline, which together will account for 30 percent of its requirements, within the next three years.
Professor Asit Biswas of the Mexico-based Third World Centre for Water Management says: "All developed countries can learn from Singapore on how best to manage urban water supply and wastewater management systems efficiently and equitably."
After signing a new partnership agreement with Singapore to jointly promote the safe management of drinking water globally, the World Health Organization’s (WHO) assistant director general Susanne Weber-Mosdorf stated that "Singapore is an exemplary model of integrated water management and WHO hopes to work closely with Singapore to share such expertise in water management with its member states."
In contrast to Singapore, Iraq has been gifted with an abundance of water from two major rivers, the Tigris and Euphrates.
But the country, rich in natural resources and with vast reserves of petroleum, has been bedeviled by years of conflict, including a war with neighboring Iran in the 1980s, the U.S.-led invasion five years ago and subsequent ongoing occupation, as well as sectarian violence.
As a result, says the United Nations, Iraq's water sector has "faced a major deterioration in recent years."
The factors contributing to the decline include: a serious lack of coordination between various public administration bodies, weak capacity to implement a national water resources plan, increasingly depleted resources and environmental degradation.
"A striking demonstration of its mismanagement," says the UN Development Programme (UNDP), "is the fact that 90 percent of Iraq's water resources are currently used for agriculture while it still imports the overwhelming majority of its agricultural products."
A three-day donor conference in Jordan last May spotlighted the major challenges in Iraq and proposed a long-term plan of action to mitigate the water crisis in the war-ravaged country.
"In order to reverse this trend, it is essential to enhance the capacity of the government to coordinate and develop an integrated water resource management strategy," says Paolo Lembo, UNDP Iraq director.
"It is true that Iraq currently faces major humanitarian challenges, but our duty is not only to rise to the dreadful actualities of the present, but also to set the foundations for sustainable development in the future," he added.
In a study released here, the Public Services International Research Unit, based in France, points out that South Africa, like Singapore, is another country on the right track for effective water management.
In 1994, as the apartheid era ended, about 15.2 million (38 percent) of South Africa's population of 40 million lacked access to basic water supply.
The post-apartheid governments have built an infrastructure that meets the needs of nearly 10 million of the rural population. And by 2009, South Africa is expected to meet the basic water supply needs of the entire country.
The study says that any realistic attempt to develop water services in middle- and low-income countries must focus on public sector water services.
"Despite all the attention that has been given to water privatization in the last 15 years, the water services of the world remain overwhelmingly provided by the public sector."
In middle- and low-income countries, 90 percent of the largest cities -- those with a population of more than one million people -- were served by a public sector operator in mid-2006.
"This dominance of the public sector is growing, as private companies retreat from many of the concessions and leases in developing countries," the study notes.
And in rural areas, where there is little profitable business for private companies, the percentage of water services provided by the public sector is closer to 100 percent.
Foundation stone laid for $4 m dam in Kikruk
August 18th 2007
Kirkuk's governor laid the foundation stone for Sherin Dam, which will cost more than 5 billion Iraqi dinars (4.03 million U.S. dollars), head of Kirkuk's Department of Water Resources, Shihab Hakim Nadir, said on Wednesday.
"The project comes as part of considerable efforts by the department to establish a number of dams in the province…," Nadir said. The dam, which is to be built on al-Khasah river that flows into the Tigris River's tributary of al-Zab, is 426 meters long and has a storage capacity of 1 million cubic meters. It is expected to take up to 13 months to build, he added. Quoting Kirkuk's governor Abdul Rahman Mustafa, Nadir said the project will boost agriculture and turn the site into a tourist attraction. Kirkuk province is giving careful attention to the building of dams and several requests were submitted to establish 11 dams, including one on al-Khasah river and 10 on the outskirts of the province, the governor indicated. Kirkuk is 250 km northeast of the Iraqi capital Baghdad.
War-torn Iraq happy with high oil prices
August 3th 2007
Middle East Times
War-torn Iraq is pleased that high oil prices will help fund emergency reconstruction work, but does not want a price bubble to cause instability, oil minister Hussein Al Shahristani said Thursday. Speaking shortly after New York oil prices hit and then retreated from a record high, the minister said that despite Iraq's dire need of revenue it might not oppose an increase in output among OPEC members to steady prices.
"Iraq is undergoing reconstruction process and is in need of large oil revenues. These price hikes will help organize the budget for reconstructing Iraq," he said in a telephone interview. "But we do not seek irrational increases in prices of crude oil that affect the world market and the consumer. Nor do we seek production increases in a way that dumps oil on the world market. So Iraq, through OPEC, seeks a balance.
"In our next OPEC meeting, we will study a slight increase in production to provide what the world market needs to maintain price balances," he said.
Oil prices were falling Thursday one day after light sweet crude hit $78.77 per barrel in New York trading for the first time, and oil-consuming countries are pressing OPEC members to increase production.
Iraq is a founding member of OPEC and this year has produced an average of 1.98 million barrels of crude per day, making it the sixth largest producer in the 12-member cartel.
It could produce much more - in 2000 Iraq pumped an average of almost 2.4 million barrels per day and peaked that year at more than 2.8 million - but development has been hampered by sabotage, corruption, and instability.
Last year the Iraqi oil ministry managed to spend only 3 percent of its capital budget, according to a report by the US Special Inspector General for Iraqi Reconstruction, Stuart Bowen.
KRG makes movement on oil law
August 3th 2007
UPI
The Kurdistan Regional government in Iraq has approved part of its own oil law while a federal law is far from approval.
The KRG's Parliament met in special session Tuesday and approved four of the 62 articles of the law governing regional oil and natural gas resources, the Voices of Iraq news agency reports.
Lawmaker Areez Abdullah said Parliament will continue taking up the law during upcoming special sessions.
The vast majority of Iraq's 115 billion barrels of oil is located in the Shiite-controlled south and Kurdish north. Iraq produces about 2 million barrels per day now, below the 2.6 million bpd pre-war level.
Iraq's Parliament has been urged by Prime Minister Nouri al-Maliki and pressured by President Bush to approve a federal oil law. That law is far from approval because of the varying standpoints of Iraq's political, ethnic and religious factions as well as the oil unions over how much control the central government should have over key oil fields vs. the regional/local governments as well as the role of foreign companies.
The Kurds have wanted action from Baghdad but are now moving forward on their own oil law. The KRG area is different from the violent and chaotic rest of Iraq. It has experienced relatively little violence and modest economic development.
The two main KRG parties disagreed on the regional oil law last week. The Patriotic Union of Kurdistan, the party of Iraqi President Jalal Talabani, walked out of a session after its request to stall the regional law was denied.
Iraq turmoil in oil-rich Basra
August 3th 2007
Politics in Iraq's oil capital, Basra, are tense as its governor faces dismissal amid allegations Shiite parties are angling for control.
Iraqi media reports indicate the area, where the vast majority of Iraq's 1.5 million barrels per day of oil exports are sent to market, is in danger of becoming inflamed.
Mohammed Musbah al-Wa'ili, a Fadhila Party member and governor of Basra province, was dismissed in a vote dominated by another party, the Supreme Iraqi Islamic Council. SIIC is one of two major Shiite parties in Iraqi Prime Minister Nouri al-Maliki's governing coalition. Fadhila was a partner until it withdrew earlier this year over disagreements with Maliki's leadership. The Sadr Movement, another Shiite party with weight in Basra, has also quit Maliki's coalition, as has the largest Sunni bloc, the Accord Front.
Maliki was asked to overturn the council's vote on Wa'ili but refused. "I will appeal to the Iraqi Judicial System," Asarq al-Awsat reports Wa'ili saying. It goes on to say the Fadhila Party accuses the parties with more power in Baghdad of attempting to obtain power in Basra. It says a proposed federal oil law, which SIIC supports, will give local authorities more decision-making powers in the oil sector.
The law is far from approval as numerous political, religious and ethnic factions, as well as unions and civil society, are at odds over how strong the federal government's arm should be in the oil sector and to what extent foreign companies should be allowed.
The Azzaman newspaper reports the Fadhila Party is urging its followers not to launch massive protests, as was planned, as negotiations continue.
Commentary: Iraq's wealth in the balance
August 3th 2007
Al Ahram Weekly
The US administration considers the ratification of the hydrocarbon law in Iraq as one of the major targets of the US occupation. Therefore, it has been pressing Iraq's government to pass the law, ostensibly as part of efforts to promote "reconciliation" among the country's religious and ethnic groups. Moreover, since oil provides 95 per cent of Iraq's national income, the recovery of the country's oil sector would reduce the US economic and military burden in Iraq.
Recent US government reports, however, show that much-awaited approval of this law designed to govern the granting of exploration rights to foreign companies would be just the beginning in addressing the Iraq oil problem. This law would provide only a broad framework for handling the Iraqi oil industry, leaving many devilish details to be worked out later. Another part of the law -- the distribution of revenue based on regional population -- will require a politically sensitive census to be undertaken, which is a difficult task under conditions of war.
Given that the law has been passed by the Iraqi cabinet and will be debated in parliament, it is vital to shed light on the nature of the law that already elicits fierce controversy. Overall, the law should be put on hold for several reasons, the most important of which are as follows.
First, the draft law is expected to clearly assign roles, decentralise the development of oil and gas fields, centralise control of revenues, and grant regions and regional oil companies the right to draw up contracts with foreign companies for exploration and development of new oil fields. Therefore, the law refers to several laws to be legislated later on, examples of which are the Iraq national oil company (INOC) law, the Oil Ministry law, and the appendices that design the contract models to be negotiated with foreign companies, being a service contract or a production sharing agreement (PSA). Since these laws represent integral parts of the main hydrocarbon law, it would be wiser to work out the whole integrated legal matrix and debate it in one go later on.
According to a recent report by the US Government Accountability Office, leaked in May 2007, a great deal of corruption has dogged Iraq's oil industry. Between 100,000- 300,000 barrels of oil per day are stolen and oil production has dwindled from 3.5 million barrels per day to less than two million barrels per day. The market value of such smuggling ranges between $5 and $15 million a day, with the aggregate value of corruption in the oil sector estimated by the Iraqi Auditor General at $24 billion over the past four years. Since local corruption could not flourish without a foreign partner, who must market the stolen oil or pass bribes or launder funds, it would be better not to expand foreign participation in Iraq's oil industry, and surely not under the aegis of occupying powers.
Considering the lack of measuring gauges that identify the volume and quality of crude oil and gas at production points as well as at loading facilities and shipping ports, it is all the more important to put things on hold. Even such equipment as exists is faulty. It is imperative to immediately repair or install adequate measuring equipment, whether the hydrocarbon law is passed or postponed.
Contracts that sell the national wealth of an occupied country are illegal under international law and can be cancelled once the occupied country is liberated. Therefore, the Iraqi governments should not expect to receive offers from well-established and respectable oil companies. Even if some American companies offer to develop Iraqi oil and gas, they have to keep in mind the possibility of their being disqualified once American troops leave. In such a case, any investment will aim at making as much money as possible in the shortest possible time before abandoning Iraq. In the oil industry, this is the most wasteful type of investment. The industry is, by nature, based on far-sighted projections and requisite long-term infrastructure that the speculation-driven investor would be hesitant to undertake.
Second, besides several loopholes and ambiguities, the draft law is flawed by several shortcomings and matters overlooked. Most important is the lack of parliamentary sanction over concession contracts or agreements to be concluded with international oil companies (IOCs). Parliamentary oversight is an established rule in almost all oil producing countries. The fact that such oversight is entrusted to the Federal Council for Oil and Gas (FCOG) does not furnish guarantees that the most will be made of the country's vital wealth. The FCOG is only part of the executive authority because it is formed by the cabinet; concession contracts and agreements negotiated and prepared by the executive authority should be sanctioned, or not, by parliament.
Article 5 of the draft law provides that parliament shall approve all petroleum treaties that Iraq signs with other countries. Yet this article does not apply to concession contracts and agreements, which are negotiated and concluded with IOCs and should be approved by parliament as well.
Article 2 excludes from the scope of the draft law several major oil and gas activities -- for example, the refining of petroleum, its industrial utilisation, as well as the storage, transport and distribution of petroleum products. The wisdom of this shortcoming is not apparent because all such activities are interrelated and the exclusion of some may leave loopholes open for possible corruption. If these interrelated activities cannot be included in the draft oil law, they should be organised and legislated in a separate law.
Article 6 establishes the Iraq National Oil Company (INOC) as a holding company fully owned by the Iraqi government, its scope of operations defined. One aspect is for the company to carry out exploration and production operations in new areas on a competitive basis with foreign companies. Article 6 clearly leaves out a long-established clause which is usually embedded in hydrocarbon laws and gives priority to the national oil company in case of equal competitive standing with foreign companies.
We now come to the most crucial condition guaranteeing healthy management of the oil and gas sector: the free and independent decision of those Iraqi officials who are to negotiate and contract with IOCs. The model contract that will be approved by the law is designed in such a way that leaves many blank spaces to be filled later. In fact, these blanks are the most crucial clauses because they cover such vital matters as production bonuses, the amount of investment to be spent on operations, the periods of each exploration and production phase, the amount of oil produced to be allocated to the foreign company for cost recovery, the period over which such costs will be recovered, the portion of total production to be obtained by the foreign company as profit (known as equity oil), the basis of sharing natural gas as well as the pricing of portions needed for domestic consumption out of the foreign company's share, and the amount of oil that is to be obtained by the Iraq government in compensation for the depletion of its national wealth (known as royalties), becoming due regardless of loss and profit after production.
There are countless such crucial matters that are left to the discretion and integrity of Iraqi negotiators, including, at the beginning, the selection of those IOCs that are to be included in a shortlist and exclusively allowed to apply for exploration and production rights.
Article 10 sets up the mechanisms of negotiation and contracting for granting rights to explore and produce oil and gas. These responsibilities are distributed among several bodies of the executive authority, on both national and regional levels. Once initial procedures are complete, the contract must be submitted to the FCOG within 30 days from the day of signing. The FCOG, if it so decides, would then submit the contract to the "Panel of Independent Advisors" for analysis on the extent of its compliance with model contracts approved by the FCOG. If the executive body that negotiated the initial contract, being the Oil Ministry, INOC or regional authority, does not receive an objection from the FCOG within 60 days of receipt of the initial contract, the contract remains valid. This mechanism clearly assumes that the initial contract is valid unless the FCOG expresses its objection within 60 days by two-thirds majority, which may be difficult to secure in many cases.
This is a very rigid and inefficient way of handling the contracting process. The time allowed is too tight, squeezing the whole decision-making process into 90 days. In practice, it often takes much longer. Contract compliance with approved models is only a formal step -- clearly inadequate given the vital items that have to be negotiated. Such hastily concluded contracts can only give rise to problems, leaving real power in the hands of select Iraqi negotiators and IOCs, with increased possibility for corruption.
The fragmentation of the contracting process between federal and regional authorities, which is strongly favoured by the Kurdistan regional government, is an inefficient system. It allows IOCs to manoeuvre and play Iraqi regions against each other. The most recent experience in this regard proved a complete failure -- Sudan. Like Iraq, there was disagreement between the north and south over the distribution of Sudan's oil wealth, 80 per cent of which lies in the south. This prompted the government of southern Sudan to contract the UK White Nile Company to operate in a certain area that was also contracted by the national government to the French company Total. Conflicting claims were not resolved until the National Petroleum Commission was established in June 2007, representing Khartoum and Juba equally, ordering the White Nile Company to halt its activities and leave Sudan.
Measured recovery in the Exchange before opening trading to foreigners
July 14th 2007
Traders in the Iraqi financial market expected that the coming stage, before allowing non-Iraqis to trade in the exchange starting on the second of next August, may witness activity moving prices to ambitious levels, paving the way for wide participation by non-Iraqis; this started to show in this week's sessions characterized by unexpectedly high index levels. The banking sector, which has suffered price retreats during the last months, is leading the recovery, an indicator of stable and gradually rising values; the share price of "Bank North", which increased its capital last month from 25 to ID100 bn, jumped from one IQD to ID4.750 dinars in a week; shareholders disagree about the reason for this.
Exchange dealers expected this trend to continue in the market next month, especially given the expected increase in the number of weekly trading sessions, starting this week, followed by an increase in the number of executed contracts and thus an upturn in transaction volumes and share liquidity.
Sources close to the Stock Exchange spoke of the Board of Governors' success last year obtaining grant of over seven million dollars to automate trading, and pointed out that a Swedish company is carrying out the automation project which is expected to be completed before the end of the current year.
It should be noted that the market value of shares traded in 2006 fell from $2.136 bn in 2005 to $1.5 bn.
Iraq looks at regional ports to import grain
July 13th 2007
Iraq, facing severe grain shortages this year, may divert imports to other ports in the region to reduce its dependence on the country's main port of Umm Qasr and speed deliveries, trade sources said yesterday.
But any such move, supported by the ministry of trade, which is in charge of procurement, would substantially raise import costs, they added.
Umm Qasr, located on Iraq's narrow Gulf coastline, has been handling 90 per cent of Iraq's supply of commodities since 2005. Before that supplies went through Syrian and Jordanian ports.
In recent months, critical supply shortfalls have emerged.
Trade data confirmed by semi-official figures shows that up to June this year Iraq had received only one million tonnes of wheat, compared with two million in the same period last year. Rice imports had reached 272,000 tonnes up to June, versus 392,000 tonnes last year.
Blame
Trade officials are said to be succumbing to pressure from international suppliers worried about security and logistics at Umm Qasr.
But transport officials and others blame erratic buying under a procurement system riddled by political interference and bureaucracy, rather than any bottlenecks at the port.
"This is a smokescreen to put the blame on the port to cover up the serious grain shortages so far this year. The port has been able to supply most of the country's commodities," said one grain trader involved closely with Iraqi state buyers.
"The current system of delivery to Umm Qasr has broadened competition in the commodities supply chain and this helped to reduce the cost of commodity imports for Iraq," an international grain trader said.
A port official said: "We have the ability to ship the commodities under the ration system from Umm Qasr across Iraq at prices much less than imports from other ports."
Port officials said demurrage was less at Umm Qasr and unloading was smooth despite a dearth of investment in new equipment.
Data show the port, with 20 berths capable of handling up to 30,000 tonnes of goods daily, at its busiest since the 2003 US-led invasion of Iraq.
The port has four berths for wheat capable of handling up to 20,000 tonnes daily and three rice berths, officials say. This far exceeds Iraq's monthly import requirements of nearly 450,000 tonnes of wheat and rice.
raq Kurds renounce support of key oil law
July 13th 2007
Kurdish leaders spoke out Wednesday against a key oil law, raising further doubts over efforts to pass one of the political benchmarks sought by the U.S. at a time when the Bush administration is trying to fend off critics of its Iraq policy.
The oil bill and other benchmarks are aimed at encouraging the Sunni Arab minority to support the government and turn away from the insurgency, easing violence over the long-term. The oil law at the center of debate now is part of a package to regulate the industry and distribute its profits, aiming to address Sunni fears of being squeezed out of the wealth by Iraq's dominant Shiites and the Kurds.
But attempts to pass the bill have been blocked by multiple disputes within Prime Minister Nouri al-Maliki's coalition, including a boycott of parliament by his Sunni Arab partners.
The Kurds made clear Wednesday they oppose the latest draft of the bill, which al-Maliki said on July 3 had been approved unanimously by his Cabinet. His aides say the draft was passed after changes were made to an earlier version Kurds had said they supported.
The top oil official in the Kurds' northern autonomous zone rejected those changes. The amendments "reduce the powers of the [Kurdish] region and should not be approved," the zone's Natural Resource Minister Ashti Hawrami said at a joint meeting of the Iraqi and Kurdish regional parliaments in the northern city of Irbil.
Iraqi government spokesman Ali al-Dabbagh said the amendments to the draft -- which have not been made public -- "were legal and dealt with the language but did not change the core."
Sunni Arabs, who are centered in regions of Iraq without proven oil reserves, are pressing for central control of the industry, fearing that Kurds and Shiites in the oil-rich north and south will control oil contracts and hoard the profits.
In other developments, Iraqi security forces seized 200 explosive belts along the Syrian border Wednesday, a police spokesman said, reinforcing Baghdad's assertions that its western neighbor isn't doing enough to stop the flow of fighters and weapons into Iraq.
The belts were found during a search of a truck that had crossed into Iraq from Syria at the Waleed border station, Interior Ministry spokesman Maj. Gen. Abdul-Karim Khalaf said.
"UNMOVIC" Committee transfers funds to Iraq Development Fund
July 13th 2007
A source at the Iraqi Finance Ministry said that the total funds, estimated at $ 60 million, in the account of the "UNMOVIC" Committee responsible for the elimination of weapons of mass destruction in Iraq have been transferred to the Iraq Development Fund.
He noted that the government worked with the international community which "contributed to the adoption of a Security Council resolution calling for the abolishment of the "UNMOVIC" Committee on the 29th of June”, which provided for the transfer of funds in its account to the Iraq Development Fund.
The same source said that these funds, "would provide important cash liquidity for supporting the Iraqi economy and meeting reconstruction needs in all of sectors", and emphasizing "Iraq's continued pursuit of its foreign assets, both those smuggled by Saddam Hussein and his aides or the ones frozen by decision of the Security Council, in addition to extinguishing its debts and dues."
A report prepared by "the House of World Investment" (Global) expected a "flow of foreign investments to Iraq for reconstruction with a focus on the oil sector." He explained that these investments "would improve the situation in the medium and long term, and produce improvements in refineries and pipelines."
According to the report, Iraq "needs about $100 billion in the next five years to rebuild its infrastructure", pointing out that wars since 1980 "led to the deterioration of the economy, as the real GDP by the end of 2003 was down 32.9%; unemployment rate rose to more than 20%, and inflation to 53% by 2006, with reduced levels of oil production up to two million barrels per day, as well as the large number of population below the poverty line, with the increasing number of unemployed to more than 1 million in Baghdad alone."
The report estimated that "GDP would grow to about 3% above 2006 levels, thanks to high oil prices, and it also predicted a decline in inflation to 30% in the medium term". It estimated losses to the oil sector during the last four years at about $15 million/day, from corruption and smuggling.
Iraq has the third largest reserves of crude oil in the world, at 115 billion barrels [proven], but pays millions of dollars to import refined petroleum products.
A Global Trade tower to encourage investment in Basrah
July 12th 2007
The local government in Basrah plans to build a Global Trade tower to encourage foreign investment in the province. The Governor of Basrah, Muhammad Misbah Alwaeli, called upon foreign investors to participate in this project, which it is hoped will be started by the end of the current year.
Alwaeli said, "We will soon announce the building of a global tower to be located in the province of Basrah; you know what large economic and geographic potential this province has, with this region the focus of attention of many investors, so we call on all world investors to participate in building the tower."
Alwaeli confirmed that the aim is to encourage foreign investment to promote economic activity in the city of Basrah, which he described as the economic capital of Iraq due to its strategic position and enormous wealth.
Iraq buys more Thai rice
July 9th 2007
Baghdad (Agencies) - A representative for the Iraqi government announced that Iraq has recently purchased between 100,000 and 150,000 tonnes of Thai rice for prices varying from $417 and $423 per tonne, the international business consortium Iraq Development Programme announced.
He further mentioned that the rice is scheduled for the July/August shipment and that Iraq's rice imports are approximately 87,000 tonnes every month.
It is noteworthy that Iraq has a minimum of 100,000 tonnes on back order, purchased as far back as December of last year, including 60,000 tonnes of Thai rice and 30,000 tonnes of US rice.
The country has shortages of only 271,000 tons compared to 392,000 tons in 2006.
Iraqi Kurds open 40 new oil sites to foreign investors
July 7th 2007
Kurdish Government in northern Iraq intends to invite foreign companies to make offers to invest in 40 new oil locations before the expected approval of the new Oil Law.
A statement broadcast on the Kurdish Authority site on the Internet on Friday included plans to hold conferences for investors in Erbil, London and perhaps in Houston to discuss bidding procedures.
The statement quoted the Kurdish Minister of Oil, Ashti Horami, saying that priority will be given to companies that can move and organize themselves quickly.
He added that this way the Kurds will make a significant contribution to the shared Iraqi revenues and thus help the process of reconciliation and the unity of Iraq.
Kurdish officials earlier this month reached an agreement with the central government in Baghdad on equitable sharing of oil revenues for the country, an important part of the new law on oil and gas.
The project, vital for planning how to share the wealth of huge oil reserves among sectarian and ethnic groups, got the approval of the Cabinet in February, but faced strong opposition from the Kurds who felt that it did not give them a fair share.
The majority of [proven] oil reserves are located in Iraq's Kurdish north and Shiite south.
There are still important parts of the draft law that need serious discussion including annexes which Kurds say they are unconstitutional because they take away oil fields from provincial governments and put them under the supervision of a new federal oil company.
Horami said that talks concerning the National Oil Company were resumed and, "We are confident that this will be agreed upon shortly."
The Kurds want to increase oil production in their region to one million from about 200 thousand barrels per day within five years. Iraq's oil production is currently about two million barrels per day.
Karbala assigns all 2007 projects to local firms
July 7th 2007
The Governor of Karbala said on Saturday that all projects announced by the province for 2007 were assigned to local companies to be implemented on time.
Dr Aqeel Al-khaz'ali said in a speech at the local administration building on Saturday that 192 projects have been awarded to local companies for implementation by the end of the year.
He indicated these are among projects for accelerating reconstruction and regional development. The timelines and costs for implementation have been identified this year, amounting to 90 bn ICQ.
Assigning the projects to local firms began once Karbala received its allocations in February. They cover all services: sewage, water, roads, education and sports, higher education, agriculture, irrigation, environment and electricity.
Dr. Aqeel al-khaz'ali said in his speech on the occasion of the first anniversary of the newspaper Reconstruction of Karbala, "The size of allocations given to Karbala do not match the needs of the province, which has suffered a lot of neglect and requires a lot of infrastructure, but this made us hasten to assign all projects for implementation."
The newspaper Reconstruction of Karbala is issued by the committee in charge of supervising the development of regions and accelerating reconstruction; it is accredited by the Press Syndicate and is the second in Karbala, after Karbala Today opened over a year and a half ago.
Iraqi bourse is on the rise in indexes
July 6th 2007
Iraqi bourse witnessed a rise in its major indexes during the two sessions of last week due to the new stage of development through which the bourse is going and that is using using the electronic system, as well as expecting the entry of Arabs and foreigners to transactions in the market early next August. The number of transactions executed on the session of Wednesday, June 27, 345 deal to the value of one billion and 250 million dinars and the number of shares in circulation has increased to 784 million shares, while the general index was 25.694 with a rise in points, as well as a general high rate of 1.766%.
The banking sector ranked first in terms of number of deals, the circulation volume and the number of shares traded, while the industrial sector ranked second.
The number of companies whose shares were traded is 39, while the companies whose shares were not traded were 27, and the companies which had meetings of their general boards were 15 companies, while 15 companies were stopped from circulation by a decision of the Iraqi bourse body.
The number of enlisted companies in seven sectors was 93 with a nominal capital of 905 billion dinars.
Non-Iraqis trading in the Iraqi Exchange soon
June 29th 2007
Head of the Iraqi Market for Securities Abdul Razzak Al-Saadi said that the decision to allow non-Iraqis–Arabs and foreigners–to circulate in the Iraqi stock exchange has been taken and been certified as a matter of principle, but its application requires clarification of how to comply with existing Iraqi laws, like those concerned with money laundering. There is also a need to define a proper basis for entry of non-Iraqis into the market, like using a known and certified bank for settlements.
Al-Saadi added that a culture in the market must evolve for dealing with non-Iraqis to make the process easy, but it needs some prerequisites to be satisfied. In any case, it is expected to be initiated as soon as possible, especially given that the Iraqi Market for Securities is on the verge of important developments, notably the adoption of electronic trading and the passing of the Iraqi exchange permanent law.
Million dollar loss from foreign organization withdrawal in Dahuk
June 29th 2007
An official in Dohuk governorate said on Sunday that a foreign organization caused considerable financial loss to the Kurdistan government, amounting to $1,000,000, by withdrawing from a project assigned to it in 2004 to build a village.
Director of Relations in the province, Hameed Ahmed Salih, said "because of the withdrawal of the American (Mission East) Organization from the village building project (Al-Bousala), a large financial loss of one million dollars was inflicted on the regional government, ... which is the value of building materials and wages of the workers."
He continued, "The organization, earlier, contracted with citizens without reference to the administration and agreed with it to build 300 houses in the village of Al-Bousala, 80 km. north of Dohuk, but when the organization found that its allocated budget was inadequate ... it turned to the administration for assistance."
Salih pointed out that "after examining the issue, it was decided to reduce the number of apartments to only 150 houses, but the villagers rejected this, which prompted the organization to abandon the project, causing a great loss to the regional government."
As for whether the organization will be held accountable, Salih said "the organization apologized for this unintentional mistake, and no lawsuit was recorded against it by the regional government."
Iraq seeks to boost cooperation with EU
June 28th 2007
Officials from the European Union and Iraq began in Brussels Monday the second round of negotiations for a Trade and Cooperation Agreement (TCA).
Iraqi foreign undersecretary Mohammad Hamoud who is leading his country's delegation to the 2-day meeting said the TCA will strengthen Iraq's relations with the EU.
"This is the second round of talks. We discussed the main issues of trade and cooperation. Views from both sides are identical. We want to reach an agreement with the EU quickly," Hamoud told reporters.
The TCA negotiations were launched between the EU and Iraq in Brussels last November to progressively strengthen the 27-member bloc's relations with Iraq and integrate the country in the world economy.
Hamoud said he found the Europeans ready to help Iraq in several fields and Iraq expected the EU to help in the reconstruction, science and technology. "We hope that friendly relations will develop with the EU to the best expected level," declared the Iraqi official.
In two months the third round of TCA negotiations will be held nd we hope that during this year we will reach to a total agreement, he added.
On his part, the director of the Mediterranean and Middle East affairs in the European Commission, Hughes Mingarelli, said "on our side we will do everything to help." Iraq in this difficult circumstances In 2003, the EU committed more than 14 billion euro in terms of debt relief, loans and grants to assist in bring about economic recovery of Iraq, he noted.
Mingarelli said through the TCA agreement EU-Iraq relations will be based on a contractual basis. "Today we had a fruitful exchange of views on the content of the agreement and I am sure we will manage to strengthen our political dialogue with Iraq,'' he said.
The EU wants to boost regional cooperation between Iraq and its neighbours. "This is extremely important if we want to bring back stability," stressed the EU official.
In reply to IRNA's question on Iraq's relations with its neighbours, Hamoud replied "with our neighbours it is always the same.
Some of them are helping Iraq, some of them not." " We are doing our best to have good relations with all the neighbouring countries. The policy of the Iraqi government is to have peaceful relations with all the countries and good neghbourhood with the neighoburing countries." The TCA covers a wide range of issues including trade in goods, services, energy, measures to encourage investment, customs, intellectual and industrial property rights, and public procurement rules.
All EU agreements with third countries now feature human rights, terrorism and WMD as important elements.
Bank Melli Iran opens first branch in Baghdad
June 28th 2007
Bank Melli Iran (BMI) inaugurated its first branch in the Iraqi capital Baghdad Monday.
The cultural attaché of Iranian Embassy in Iraq told MNA that Iran's Ambassador Hassan Kazemi-Qomi, representatives of Iranian Foreign Ministry and Central Bank of Iran (CBI), and governors of local banks were present in the opening ceremony.
Seyyed Khalil Sadati said the BMI branch is the first foreign bank that was inaugurated in Baghdad after the overthrow of former Iraqi president Saddam Hussein.
Cost of raising Iraq crude output approaches $75b
June 28th 2007
The estimated cost of boosting Iraq's oil output to six million barrels per day has soared to as high as $75 billion, a government adviser said yesterday.
Iraq's shattered oil industry is currently producing around two million bpd. Officials had said around $25 billion would be needed to triple that figure.
"Costs are much higher than thought. It could be a two- to three- to four-fold increase, as much as between $50-$75 billion," Thamir Ghadhban, energy adviser to Iraq's prime minister, told an energy conference.
Constant sabotage attacks on the country's pipelines have left crude oil production stuck at around two million bpd since the 2003 Iraq invasion. Ghadhban said if the violence on oil facilities subsided, Iraqi production could rise to 2.8 million bpd by the end of the year.
Ghadhban remained hopeful Iraq's parliament would pass a draft hydrocarbon law in the next few months.
Iraq oil strike called off
June 12th 2007
Iraq's oil unions ended their strike, which was to restart Monday and include oil exports, after a government committee was formed to address demands. Hassan Jumaa Awad, president of the Iraq Federation of Oil Unions, released a statement that the work stoppage that began last week and was to escalate Monday will be canceled.
The IFOU, an umbrella union federation representing more than 26,000 workers, met for the past five days with a delegation sent to Basra, Iraq, by Prime Minister Nouri al-Maliki.
The Iraq Pipelines Union began the strike last Monday after the Iraq Pipelines Co. halted regular bonus checks. The IPU is a member of the IFOU, which had been threatening to strike since last month over complaints of poor working conditions, among other issues.
The unions also want to be a party to negotiations over the draft Iraq oil law, which they fear will give foreign companies too much access to the country's 115 billion barrels of proven oil reserves, the third-most in the world.
Following a meeting May 16, the IFOU said Maliki agreed to form a committee to address the union's demands.
Awad said the "minister of state for parliament affairs" led Maliki's delegation last week and the sides agreed to officially form the committee, resulting in the unions calling off the strike.
Last week, production and transport of oil, natural gas and products were halted, including shipments to Baghdad, and the unions were threatening to take all of Iraq's 1.6 million barrels of oil per day off the market, the sales of which fund 93 percent of the federal budget.
Awad's statement was translated and distributed by Naftana, a Britain-based solidarity group.
Negotiations over the oil law are stuck on a dispute over distributing the oil revenue, regional versus central control over the oil and the limits of foreign investment.
Basrah contains huge oil wealth
June 12th 2007
Oil researcher, Ahmad Al-Husseini, said that geological studies "in Iraq showed that there are about 530 geological complexes of good prospects for oil; about 115 sites have been drilled so far with reserves estimated at about 3,111 billion barrels of oil, which leaves 415 locations requiring exploration." He pointed out, "reserves in the 415 sites unexplored for various reasons are estimated at over 215 billion barrels." He believed that regions and provinces rich in oil "will include in future nearly two thirds of Iraq."
Al-Husseini pointed out, in a symposium organized by the University of Babylon on the oil and gas law and attended by oil and economy experts, that oil reserves in Iraq "are parallel to those discovered in Saudi Arabia which is today the top producer of oil in the world." He said that current producing fields are "concentrated in the provinces of Basrah and Kirkuk, versus little production from a few other fields located in the provinces of Maysan, Baghdad, Salahaddin, Diyala and Mosul." He said, "the present discovered and undeveloped fields are deployed in all Iraqi provinces but four: Qadisiyah, Babil, Anbar and Dohuk".
The expert noted that Basrah "holds the largest oil wealth in Iraq. According to the statistical data, it has 15 oil fields, including 10 producing ones and even they are still waiting for development and production, while the rocks in these fields contain over 65 billion barrels of oil which comprise about 59% of the total Iraqi oil reserve. Also, the oil reserves in the provinces of Basrah, Thi-Qar and Maysan represent 79.4 billion barrels, or 71% of the total reserve in the country,"
He pointed out that these figures mean that "the largest part of oil reserve is concentrated in the south and somewhat in Kirkuk where it is estimated at 13.45 billion barrels, which is about 12% of the total proven reserve of Iraqi oil, while the Kurdistan region contains 3.16 billion barrels, or 3% of the total."
[Ed. Note: recently estimates of large unproven reserves in Anbar were revealed, adding about 100 bbl to the Iraq total.]
Contract with France's Renault to provide cheap cars
June 12th 2007
Iraq contracted with the French company Renault to provide new vehicles to citizens through direct sales. Director-General of the General Company for Cars, Kareem Fajr, said that his Company "contracted with Renault via a private company for the supply of Renault trucks, in addition to French-made Peugeot cars. He pointed "to an exhibition of the Company showing multiple types of modern cars, and any citizen can examine supply details."
Fajr revealed that, "government support for his Company had been lifted, and it now operates with private finance, earning simple profit, within controls established by the government, not exceeding 5%." He pointed out that the media "invites citizens through daily bulletins to visit exhibitions of the Company, to learn more details about the purchase of Peugeot cars made in Iran, which experienced good demand."
Reflecting the importance of this step, many traders took the opportunity to talk about this trade, which has become lucrative despite problems caused by the traffic jams on the streets from large numbers of cars entering Iraq after April 2003. According to statistics, more than 1.5 million cars entered Iraq during this period, compelling the government to allow only half of this number to move in Baghdad on any given day, according to odd and even license numbers.
A sector trader pointed out, "the import is constant because the State did not establish controls except the decision blocking import of cars manufactured before 2006." The trader explained, "they turned round the decision and pressured the government to postpone implementing it, arguing that they signed contracts with foreign companies for purchase of thousands of cars not yet arrived."
Another dealer said that the Iraqi government "does not make firm decisions; it once decided to block previous models, manufactured in 2000 or earlier, but the traders continued to import merely by referring the cars to certain parties or saying that they were scrap."
The widespread of car exhibitions and selling yards in Baghdad shows that this trade has prompted thousands of traders to make profits. A car dealer on Palestine Street, where there are a large number of car exhibitions, said that "the State ought to regulate this sector and remove the pollution that has accompanied imports after the fall of the regime in 2003. This reflects the problem affecting everyone, which is that a large number of imported cars during this period are merely the "waste" of the world's nations, purchased by millions of dinars."
Aqaba and Tartoos ports considered for import of food
June 11th 2007
The Ministry of Trade said it is studying the idea of using the ports of Aqaba in Jordan and Tartoos in Syria to import food for northern and western areas of Iraq.
The ministry said in a statement quoting the Minister of Trade Dr. Abdul Falah al-Sudani, that the ministry was considering several options to "expedite delivery of ration items and reduce impediments to sea and land transport." Al-Sudani said, "The ministry is currently considering use of the ports of Aqaba in Jordan and Tartoos in Syria to improve transfer of goods to northern and western areas facing difficulties in transportation from southern ports."
The minister explained, "Study of this topic comes in the context of ministry and government plans to upgrade economic and commercial relations with Iraq's neighbors to the best levels possible."
The Minister of Trade met recently the Jordanian Minister of Trade and Industry in Amman to discuss new mechanisms to develop relations and increase trade.
Iraq currently depends almost entirely on the ports of Basrah for the passage of foodstuffs, and the process of transferring them to north and west areas is facing considerable difficulties.
80% of production controlled by National oil company
June 1th 2007
Oil minister Hussein Shahrastani said on Friday that the Iraqi oil law is not expected to provide production-sharing contracts and will ensure that the National Oil Company controls 80% of the oil reserves.
Shahrastani said this means that 80% of the discovered reserves will be dedicated to the national company, which invalidates the claim that the law will pave the way for foreign companies to monopolize Iraqi oil.
He added that agreements to exploit other oil fields are left to the Federal Council of Oil and Gas.
Currency demand and exchange rate with dollar rise in Central Bank auction
June 1th 2007
The demand for dollar purchases in the Central Bank auction increased on Wednesday, to a total volume of reached 68 million, 890 thousand dollars against 24 million, 415 thousand dollars on Tuesday, while the exchange rate rose to 1260 dinars.
The bulletin issued by the Bank on the status of the auction showed that 17 million, 380 thousand dollars were cash purchase orders, while 51 million, 610 thousand dollars were in the form of remittances outside the country. They were fully covered by the Bank at an exchange rate of 1260 dinars, one point above yesterday's rate of 1259 dinars; this is the first exchange rate increase in more than two months.
None of the 15 banks participating in the auction made any offers to sell dollars to the Bank.
Ali Al-Yasiri, a dealer with the bank, explained that dealers waited for depreciation of the exchange rate to make remittances and buy quantities of foreign currency, but the opposite development led to increased late transactions yesterday once they knew the rate would not fall throughout today and tomorrow.
Currency reserve: $21 billion
June 1th 2007
Minister of Finance, Bayan Jabr Al-Zubaidi, revealed that 45 countries wrote off Iraqi debt at rates ranging from 80 to 100%, for a total of $140 billion.
He considered that this "breakthrough comes in the framework of the agreement signed between the Iraqi government and the International Monetary Fund," praising the role of Saudi Arabia which promised to write off 80% of its claims on Iraq, as well as of China, which declared its commitment to the rules of the Paris Club. Al-Zubaidi stressed that the 2007 budget, "differs from last year's budget." He pointed out that "the proportion of the budget implementation by some ministries was good while others were unable to do so," emphasizing that the funds "will be removed from the ministries that have been unable to implement the budget and give them to other ministries." He pointed out that this year "has been relatively stable in inflation which ranged between 40 and 45%," pointing out the success of the Iraqi Central Bank in the collection of hard currency reserves, which reached $21 billion, a good amount that can provide reassurance of stability.
Largest natural gas field in Iraq discovered
June 1th 2007
Spokesman of the Oil Ministry, Assim Jihad, revealed last Wednesday the existence of the largest natural gas field in Iraq extending from the border of Nineveh to the West of Al-Qaaem, with extensions to the Iraqi-Saudi border. Productivity is estimated at about an initial 100 thousand barrels per day.
Jihad said that the European Union is exceptionally interested in the Ukash gas field in Iraq because of its proximity to the European Union via the strategic gas pipeline project linking to Egypt, Jordan and Syria through Turkey.
Jihad pointed out that the Ministry of Oil held intensive talks with the European Union delegation in the past few days on the Ukash field.
Assim Jihad stressed that future investments in the Ukash field would make Iraq one of the largest producers of natural gas.
U.S. report on Iraq's oil is inaccurate
May 22th 2007
Assim Jihad, spokesman of the Ministry, said that the report is mixing the data on crude with that of the other raw products accompanying it, and smuggling such quantities without being detected by the security forces of America is extremely difficult. He added: "the reported figures are unreasonable, wrong and groundless".
He continued, "The smuggling of crude oil is very complex and almost impossible. It is has no economic feasibility to smugglers because it needs refineries."
The Government Accounting Bureau in the United States said on Tuesday that up to 300 thousand barrels per day of production are likely to disappear, while the Iraqi oil sector is facing difficulties in pumping 1 million barrels per day because of worn equipment, sabotage attacks and years of neglect.
The Bureau said that there is a difference of between one hundred thousand and 300 thousand barrels per day between the daily production data supplied by the Foreign Ministry, and that supplied by the Energy Information Administration of the American Ministry of Energy.
Jihad said, "They are saying that one hundred to 300 thousand are likely to be smuggled outside the official accounts; this can not be done because this quantity would require 1500 to 5000 cars, and this large number is way beyond the capabilities of the Oil Ministry itself." He continued, "American forces are in full control of the southern outlets," explaining that they had not reported smuggling of such quantities to the Ministry, quant very difficult to pass without notice. He added: "We also have no pipeline and outlets on Shatt al-Arab able to smuggle such quantities."
Jihad admitted that there are differences between the daily and monthly production data, and said, "Yes, there is a difference between the (total) figures of daily production and the figure at the end of month because the quantity we announce daily is partly water, gas and everything that comes with crude oil."
He added that it is normal, because of the lack of adequate counters, that there are differences between the data sets, but not because of smuggling, and not by the amount mentioned in the report; the differences might amount to about one hundred thousand barrels per day.
Oil is the mainstay of Iraqi economy; it represents 70% of the total local production and provides 95% of government's revenues.
The data in this report is consistent with a previous report offered by the Iraqi Studies Group in December, 2006 which said that up to 500 thousand barrels of Iraqi oil per day are stolen. The two sides agreed that Iraq needs a system for measuring oil (production) and maintaining it.
Iraqi market index declines slightly
May 22th 2007
Iraqi market index for Stock Exchange closed at 25.344 points, down by 1.542% from the previous session.
The shares of 15 banking companies were traded in the market yesterday, with 4 shares rising: the Iraqi Credit Bank by 4.6%, Sumar Commercial Bank by 4%, Al Warkaa Bank by 2.9%, and Kurdistan Bank by 2.6%. The shares of 8 companies decreased: the Iraqi Investment Bank by 7.4%, the Gulf Bank by 7.4%, the Islamic Bank by 6.2%, Bank of Baghdad by 6.1%, and Bank of Basra by 4.7%.
Nine million Iraqis live in poverty
May 22th 2007
The Ministry of Planning and Development Cooperation said that about nine million Iraqis are living under the poverty line according to a sociological survey conducted by the Central Body for Statistics.
An official source at the ministry said that "this survey was conducted on different samples in all governorates; results showed that more than nine million Iraqis are living under the poverty line because a large proportion of them depend on food subsidies and subsidized basic commodities such as fuel, with many Iraqi markets not working regularly.” He added, "The Central Body for Statistics entered the results of this survey into the future plans of the Ministry of Planning, in order to reduce rates of poverty and help Iraqi families rise above the poverty line,” and pointing out, "There are many training programs under a number of ministries to provide jobs for the unemployed, thus attempting to eliminate unemployment, a significant cause of poverty.” The latest economic studies confirmed earlier that poverty in Iraq is rising continuously due to the lack of plans and projects in all governorates to reduce poverty.
A new Kuwait cooperation convention
May 22th 2007
The Ministry of Trade presented a proposal to the Kuwaiti side on the possibility of an agreement on economic, trade, cultural and artistic cooperation to develop bilateral relations between the two countries.
A source at the Ministry of Trade said that the goal of the proposals submitted is to cancel the 1964 agreement signed between the two countries and create a new convention in line with developments in common bilateral relations, through which Iraq is trying to open new and better vistas.
The source added that the proposals had been referred to the Foreign Ministry for presentation to the Kuwaiti side for study, intending to agree later on a new date for meetings of the joint Iraqi-Kuwaiti Committee (which seeks to develop mechanisms for developing the bilateral relations in all fields). He added that the ministry is working according to mechanisms designed to develop relations, implement bilateral agreements, and work for the establishment of specialized exhibitions in all areas. As well, it is studying previous conventions, and formulating new proposals in coordination with the relevant ministries.
Debt confusion in Bulgaria
May 15th 2007
Iraqi finance minister Boyan Jabor caused a stir by announcing on May 3 the names of three Eastern European countries, including Bulgaria, that he said had agreed to waive 80 per cent of Iraq’s debt to them.
The statement was made during an international conference held on May 3 in the Egyptian Red Sea resort of Sharm El-Sheikh. The conference was attended by representatives of more than 30 countries, including Bulgaria, represented by Foreign Minister Ivailo Kalfin. The aim of the conference was to give impetus to an international programme to assist Iraq’s recovery from the damage done to it by the war. Iraqi prime minister Nuri Al-Maliki called on all countries to waive Iraq’s debt, which currently adds up to about $50 billion. Of this sum, Iraq’s debt to Bulgaria is estimated at $1.7 billion.
By May 9, it was not clear where the idea that Bulgaria was waiving Iraq’s debt came from. Immediately after media reports about Jabor’s statement, Bulgaria’s Foreign Ministry issued a statement in Kalfin’s name saying that “Bulgaria has not taken on the responsibility to waive Iraq’s debt”.
On May 7, the Foreign Ministry told the Sofia Echo that they had no information as to why Jabor had said that Bulgaria had agreed to waive Iraq’s debt.
In fact, according to an official transcript from the conference, Kalfin said that “Bulgaria is a country having an outstanding debt issue with Iraq. At this moment we are finalising the technical talks. The next step is to consider various options and to take the political decision in the respective institutions. Our aim is to reach a balanced, positive and realistic solution and we shall make it in co-operation and co-ordination with the government of Iraq.” From the statement it does not become clear what the “balanced, positive and realistic solution” would be, but there is no explicit statement that the debt would be waived.
The Sofia Echo also sought an explanation from the Iraqi embassy in Sofia. “There is no official information as to why Jabor said this about Bulgaria,” an embassy official said.
Iraq’s debt to Bulgaria is the equivalent of about five per cent of Bulgaria’s GDP for 2006, meaning about $34 billion.
Media reports that Bulgaria would waive the debt spurred controversy among critics in the country. When in 2003 Bulgaria decided to participate in the Iraq-US war on the side of the US, one of the key factors that affected this decision was the assurance that Bulgaria would get preferential treatment when it comes to Iraq’s debt repayments after the war. Jabor’s statement raised the question whether Bulgaria is being pressured into waiving the debt, following the example of some other countries.
Iraq to push for Indian refineries during visit
May 15th 2007
Iraq will press Indian firms to set up refineries there during a four-day visit to India by Oil Minister Hussain al-Shahristani later this month, an Iraqi official said on Monday.
"We will invite India to establish refineries in Iraq ... the capacity of our refineries is very limited," said Muayad Hussain, Iraq's charge d'affaires in India.
Shahristani is due in India from 24-27 May.
Iraq has a refining capacity of 603,000 barrels per day. It produces 477,000 bpd of refined products and consumption stands at 514,000 bpd, according to the OPEC Web site.
During a visit to the Saudi capital Riyadh earlier this month, Oil Minister Murli Deora met Shahristani. The participation of Indian state explorer Oil and Natural Gas Corp. and other firms in Iraq's oil sector was raised.
The Iraqi minister invited Indian Oil Corp. and Engineers India Ltd. to consider entering the downstream sector.
Hussain said in New Delhi that the exploration of the Tuba oil field in southern Iraq could also feature in talks between the two countries.
ONGC, Reliance Industries Ltd. and Algeria's Sonatrach tried in 2000 to secure Tuba.
Iraq is expected to enact an oil law by May-end that would allow its various regions to negotiate oilfield contracts with foreign investors.
Baghdad desperately needs foreign investment to revive its shattered economy, which relies heavily on oil export revenues. The country straddles the world's third largest oil reserves.
Decades of war, sanctions, under-investment and now widespread violence and sabotage have left it critically short of fuel. It has to import nearly half of all its gasoline.
Iraq has eight refineries, none of which were damaged during the U.S.-led invasion in 2003. Oil officials say that Iraq's refineries are operating at only 50-75 percent of capacity, forcing Baghdad to import most of its fuel.
Baghdad grants Jordan preferential prices for oil
May 15th 2007
Iraqi Minister of Planning, Ali Baban, said that the oil agreement between Iraq and Jordan provides for the latter to provide oil at preferential prices, up to $18 per discount on the worldwide price of oil.
He added, during his presence in the fourth international exhibition for the reconstruction of Iraq held in Amman, that the problem is in the unstable security situation on the road between Beiji and the Iraqi border, which impede the implementation of the agreement signed in Baghdad, when the Jordanian Prime Minister, Maaroof Al-Bikheet visited it last year, and not in the relations between Iraq and Jordan. He stressed the needed of the two countries for pipeline between them, but such a pipeline has not been built despite the need for it. He pointed out that after this period, the Jordanian government found the road unsafe for the transport of oil from Iraq, and we are still ready to implement this project if not for the security dilemmas that accompany the transport process.
He said that there is a complex security situation, but this does not prevent us from the construction process, "We can not achieve any security success unless the Iraqi citizen senses a kind of prosperity and improved services".
About the budget, he said that the security aspect has put pressure on our budget for this year; $8 billion have been allocated to fund security and military forces out of $41 billion of the State' budget, to build these forces and get them ready to assume full security responsibility from the multinational forces that could leave Iraq at any time; they are free in their decision, but we must be prepared for that.
EU pledges support for helping Iraq with reform plan
May 15th 2007
The European Union on Monday pledged support for the implementation of an ambitious international plan aimed at helping Iraq's economy, saying the pact was central for developing relations between Iraq and its partner countries.
EU foreign ministers said the recent launch of the International Compact for Iraq was 'encouraging and hopefully will contribute to an improvement of the situation in Iraq.'
The broad-based contract with the country commits the international community to substantial aid in exchange for a promise of unity in Iraq within five years.
EU ministers commended Iraq for 'the ambitious commitments it has made' in the plan to promote reforms in politics, security, economics and social affairs.
'The implementation of these commitments will be central in developing co-operation between Iraq and all its international partners,' ministers said after a meeting in Brussels.
Countries worldwide, but in particular states in the region, 'have a responsibility to support and promote the difficult process of national reconciliation and stabilization in Iraq, and to prevent outside interference that could undermine it,' they said.
The International Compact for Iraq includes debt reduction and aid packages but also requires the Iraqi government to take stronger steps to end sectarian violence and move toward political reconciliation between rivalling Shiites and Sunnis.
EU ministers also called for 'effective' follow-up action to the Iraq conference in Egypt earlier this month, including work in the areas of security, refugees and energy.
The Sharm el-Sheikh meeting brought together top diplomats from 21 countries, including Iraq's neighbouring states, the five permanent members of the United Nations Security Council and members of the G8 club of wealthy nations.
S. Korea to extend US$100 mln to Iraq, push joint oil development
May 9th 2007
SEOUL, May 9 (Yonhap) -- South Korea will provide US$100 million in soft loans to Iraq to help rebuild the war-torn country and push for the joint development of crude oil, the government said Wednesday.
The aid will come from South Korea's Economic Development and Cooperation Fund and be extended to Baghdad from 2008 to 2011, the Ministry of Commerce, Industry and Energy. Details on the terms and use of the soft loans will be decided later.
Iraq intends to automate its general banking sector
May 9th 2007
Director-General of “Rafidein Bank”, Abdul Hussein Al-Yasiri, said that implementing the restructuring of the banking sector will begin soon, by the adoption of a comprehensive electronic system and mechanisms to keep pace with new developments.
He pointed out to the establishment of special training centers of the sector, in addition to external courses and preparation of studies to evaluate the annual performance, using research centers and specialists.
He stressed that human resource development is a human long-term investment, leading to upgrade the performance of the banking sector, in addition to the importance of opening branches and offices to provide better banking services for the citizen, in all available areas, pointing out that “Rafidain” (founded in 1941) in about to implement a comprehensive process of development, includes linking all its branches with new techniques that enhance its competitiveness with foreign banks which are expected to open branches in Iraq.
He explained that the role of the banking sector in economic development lies in its ability to mobilize savings and invest them in economic sectors, expanding monetary credit and long-term finance to projects serving the overall development; he added that the investment in this area is the most important factor in the development of the stock market.
He pointed to the success of the Central Bank in raising the price of the dinar against the dollar, pointing out that the prices of goods and services remains high, which are reflected negatively on the cost of production.
He explained that the process of controlling interest rates have become vested to the banks since 2004, after being confined to the “Central”, and raising interest rates would cut down the lending rates.
Egypt exempts Iraq from debts of $ 800 million
May 5th 2007
Iraqi Minister of Finance said on Thursday that Egypt has agreed to cancel all debts owed to it by Iraq, amounting to $ 800 million, at an international conference in support of Iraqi institutions.
The Minister of Finance, Bayan Jabr, made his statement while the Ministers of more than ten countries and international organizations are meeting for one day at the resort of Sharm el-Sheikh on the Red Sea to agree on an international covenant to Iraq; this International Covenant document is a five-year plan offers financial, political and technical support to Iraqi institutions in return for political, security and economic reforms.
Jabr said that three countries of Eastern Europe: Slovenia, Bulgaria and Poland have also approved to exempt Iraq from 80% of the debts owed to them, but he did not disclose the value of these canceled debts.
He added that the European Union would give Iraq 200 million dollars and that he expects donations from some Asian countries as well.
Iraq, which has the third largest oil reserves in the world, is struggling to rebuild its faltering economy after four years of violence following the invasion led by the United States in 2003.
Oil exports in April 1.605 million barrels a day
May 5th 2007
A spokesman for the Iraqi Oil Ministry said on Thursday that Iraq exported 1.605 million barrels of oil a day in April compared with 1.62 million barrels per day in March, and attributed the slight decline to sabotage attacks on the northern oil fields.
April is the second month that witnessed a high level of exports after it has remained up to 1.5 million barrels a day for a period.
The spokesman, Assim Jihad, said the exports in April include 1.594 million barrels a day through the ports in Basrah in south; another 11 thousand barrels were exported daily to Syria through Ein Zalah field near the city of Mosul in the north.
Jihad told Reuters "crude oil exports from Kirkuk in the north continue to stumble because of the continuing sabotage to the oil pipelines in the region".
The level of exports in March which reached 1.62 million barrels a day were the highest since September 2006, according to Jihad.
Foreign Ministers Arriving in Egypt for Key Iraq Conference
May 2th 2007
Iraqi Prime Minister Nouri al-Maliki said the meeting aims to build support for Iraq's political process and for its fight against terrorism.
Speaking to reporters at the airport, he said Iraq's problems are spreading outside its borders.
The Sharm el-Sheikh conference is seen as the biggest and most inclusive diplomatic push to end Iraq's crisis since the 2003 invasion that toppled Saddam Hussein. All of the countries bordering Iraq are taking part, as well as the five permanent members of the U.N. Security Council and the G-8 group of leading industrialized nations.
Nobody is pretending the two-day meeting will end the chaos in Iraq. Arab League spokesman Hisham Yousef told reporters, Iraq will need help to solve its problems.
"But they can't do it by themselves," said Yousef. "They need help. There are all kinds of influences, from different regional countries and from countries abroad, on a number of political forces in Iraq. So, they can contribute by encouraging the political forces in Iraq to become more flexible, to try to reach compromises, to reach agreements and so on."
He said the only focus is on helping the Iraqi people get out of the crisis.
Despite U.S. efforts to bring in more troops to stabilize the situation, violence continues, and a growing number of refugees are straining resources in several of Iraq's neighboring countries. On her way to the conference, U.S. Secretary of State Condoleezza Rice downplayed expectations for the meeting. She said it will take time to overcome suspicions, but the choice is between a stable Iraq or an unstable Middle East.
Speaking in Washington, President Bush said he is looking forward to seeing the outcome of the meeting, and he expressed hope Iraq will get greater support from its neighbors and the international community.
"It's in the world's interest that this young democracy survive," said president Bush. "It is certainly in the interest of the neighborhood that Iraq be a country that can govern itself and sustain itself and defend itself, a government which rejects radicalism."
Previous international meetings aimed at stabilizing Iraq have yielded few results. Arab League spokesman Hisham Yousef said past failure is no reason to stop trying.
"We're continuing to try," he said. "Now, there is more focus on the political, on the process of reconciliation, and this is an emphasis that we have been working on for a very long time, and we welcome this new focus."
The Iraq conference brings together a number of nations that have a history of tension and hostility, including the United States, Iran and Syria. It is possible Secretary of State Rice will meet her Iranian counterpart, Foreign Minister Manouchehr Mottaki, on the sidelines of the meeting, although recent remarks by several Iranian officials indicate that the matter is not settled.
Rice said they would not hold full-scale negotiations, but she said if the two happened to meet, they would, in her words, "be polite and see what the encounter brings."
There are also reports that Rice could meet with Syrian Foreign Minister Walid Moallem. U.S. officials have not confirmed a planned meeting, but on a stopover in Ireland on the way to the conference, Rice said she would not rule it out.
The United States has frosty relations with Syria and no diplomatic relations at all with Iran.
In addition to stability and security issues, the Sharm el-Sheikh meeting also will be a major meeting of donor nations. Both Iraqi and U.S. officials say they are hoping for an agreement on debt relief, which they say would ease the financial burden on the Iraqi government.
Analysis: Fight rages over Iraq oil law
April 28th 2007
UPI
Discussions turned contentious among the more than 60 Iraqi oil officials reviewing Iraq's draft hydrocarbons bill last week in the United Arab Emirates. But the dispute highlighted the need for further negotiations on the proposed law that was stalled in talks for nearly eight months, then pushed through Iraq's Cabinet without most key provisions.
Tariq Shafiq, one of three authors of the law, said he attended the Dubai summit "reluctantly," at the request of Oil Minister Hussein al-Shahristani.
"I thought it would help," Shafiq said, hoping all Iraqi sides in the debate over its oil law would meet and iron out their differences. "Apparently it did not."
Petroleum Intelligence Weekly reports talks in Dubai led to "heated exchanges."
Instead, the voices of those who disagree with the law or, like Shafiq, oppose what it has become since the initial draft and how it was kept from the public, were not given part of the platform.
"Had there been genuine interest in having consensus," Shafiq said, "the two differing parties should have sat -- not publicly in front of the television -- to discuss with an open heart how you can reach a compromise. But this apparently was not their aim."
Most of the law, which is better referred to as a regime, or a set of interworking laws, has yet to be finalized. But the main sticking points have the central government and Kurdistan Regional Government at loggerheads still.
Although the Bush administration, led by former U.S. Ambassador to Iraq and now U.N. Ambassador Zalmay Khalilzad, praised passage of the framework law when Iraq's Cabinet approved it late February, it doesn't quite qualify as one of the benchmarks he has set for success in Iraq.
"To give every Iraqi citizen a stake in the country's economy, Iraq will pass legislation to share oil revenues among all Iraqis," Bush said in a national address Jan. 10. But neither the KRG nor the central government has agreed on the percentage of oil revenue to be shared. The KRG wants an automatic mechanism to redistribute the funds, while the central government wants it collected to the central bank, to be doled out by the Iraqi finance minister.
Before any more development of the oil sector, struggling to produce 2 million barrels per day, both sides must agree on which of the 116 billion barrels worth of fields will be under the control of the central government -- most likely via the reconstituted Iraq National Oil Co. -- and which fields the regions and governorates will control. The Iraqi constitution, passed in 2005, was written vaguely to garner enough support, but fueled the current disagreement over control of oil reserves, the world's third-largest.
Shahristani told reporters on the sidelines of the Dubai meeting that Parliament would take up the law this week -- which didn't happen -- while Ashti Hawrami, the KRG's oil minister, vowed Kurdish parliamentarians would veto it as written.
Negotiations continue on other aspects, such as the contract models allowed to sign with much-needed investors and the exact roles the federal oil and gas council, Iraq Oil Minister and INOC will play.
All this is supposed to be done by May 31, a deadline set by a Bush administration that needs a progress marker for Iraq, a fragile Iraqi central government that is falling apart and the KRG that is ready to continue development in its semi-autonomous and relatively peaceful northern region.
"I just don't see that. It's just too much," said Frank A. Verrastro, director and senior fellow of the energy program at the Center for Strategic and International Studies, a centrist Washington think tank. The framework is important, he said, but it has no value standing alone.
He said at least in Dubai they realized there are "significant issues" to resolve still.
There are many who oppose the law. Iraq's oil unions have threatened to shutdown production if foreign companies are allowed too much control. Many political and sectarian blocs also feel that way. And Sunnis, a minority group without oil land and the power wielded while Saddam Hussein reigned, fear they'll wind up without if the central government is weak.
"If the law does not state a precise formula for that distribution, then the law is fairly meaningless," said Thomas Mowle, an associate political science professor at the U.S. Air Force Academy who served in the Strategy, Plans, and Assessment Division, Headquarters Multinational Force-Iraq, Baghdad, from August to December 2004.
"If the law includes the distribution of revenue from future oil projects, then the Kurds are likely to reject it as unconstitutional," he said. "If the law does not include such revenue, then it will accomplish little toward national reconciliation."
Shafiq said "the majority of the oil technocrats are against" the law as written. He said the eight months negotiators took after the drafters were finished was too long. And it was kept secret from the public and parliamentarians, which then added to the politicization.
"The weak thing about their procedure is they never published the draft," Shafiq said. "They should have had teams to explain this to unions, to intellectuals, to nongovernmental organizations, to the parliamentarians, and then get the gist of their reactions before they start finalizing a draft."
And then, with the Bush administration needing results, officials leaned on negotiators to pass something. Out came the framework. Khalilzad announced its passage, and the KRG sent out a news release. "That was a big mistake," Shafiq said.
Taxes revenues expected to increase 50%
April 27th 2007
General manager of the Taxes General Institution, Talib Muhsin Jabir Abu Gaillah, expected that tax revenues will rise by 50% from what they were last year, praising the role played by private sector companies in support of those revenues through their continuous respond to tax and avoid tax evasion, while representatives of some private sector companies called to raise customs deductions on goods and materials entering Iraq in order to activate the role of local industry.. Abu Gaillah added in a symposium organized by the Institution along with a number of representatives of private sector companies: The Institution constantly seeks to support the local product and Iraqi private companies through reducing or eliminating tax deductions on them, pointing out that this step was taken in an effort to raise the productive capacity and to support local Iraqi industry in order to make it a strong competitor of the imported goods. He also explained that the cuts’ rate is minimum compared with the neighboring countries that impose high tax rates on their corporations, but the Institution had consistently supported Iraqi economy and encouraged domestic or foreign investment.
Abul Gaillah confirmed that the first quarter of the current year witnessed all the achievements planned for and anticipated at the same time the increase of tax income rates for this year by 50% compared to last year's revenues, which exceeded (300) billion Iraqi dinars which formed 3% of the total budget. A number of private sector representatives participating in the symposium called for accelerating the drafting of high customs deductions on imported goods which would help to promote the country’s industrial status.. They said in their conversations during the symposium: Many of the materials and goods coming across the Iraqi border are not covered by tax deductions which led to the suspension of the local industry almost completely, pointing out that many of the goods entering are not compatible to the specifications and metrology of the Quality and Control Body and often have less quality than the local product. They also called for exempting the local product from tax deductions in order to support and encourage the factories producing it... The representative of Bunnia group companies, Hashim Jassim, said that local industry is facing great pressure by not providing the proper environment represented by the insufficiency of fuel, and opening the borders to imported goods, in addition to many other obstacles standing in the way of industry. Hashem added: it is very difficult to apply pure tax rules without any tolerance and not protecting the local industry from imported goods, and not supporting industrial projects, noting that it is very difficult for Iraqi industry to compete with goods entering Iraq. Representative of Iraqi Federation of Industries, Abd Jassim Hameed, considered it unlikely for taxes to be one of the impediments that are preventing the growth of industry in Iraq, indicating that the problem of industry lies in the deterioration of the security situation and the migration of capitals and professionals.
Hameed said the problem of the private sector is not in taxes, but there are many other constraints led to the weakening of this sector, where most industrial zones suffer from the lack of security, in addition to flooding the market with imported foreign products of low-quality, which have negatively impacted the sector.
Representative of Talal Albehrani commercial group companies, Yassir Isam, has proposed supporting industrial companies through supporting the final product by exempting it from tax deductions.
Iraq 'could become world's biggest oil exporter'
April 22th 2007
War-torn Iraq could more than double its oil production and become the world's largest producer, according to a new study.
Energy analyst IHS says that the Middle Eastern country could produce an extra 100 billion barrels of oil every year on top of its current level of 116 billion.
The claim is part of IHS' forthcoming Iraq Atlas, which it says is the first detailed analysis of Iraq's oil reserves since the US-led invasion four years ago.
Ahead of the project's publication on May 9th, the oil analyst says that there are potentially 100 billion barrels of oil in Iraq's western desert.
"Most of Iraq's oil production comes from the south of Iraq and is exported via the Persian Gulf because of repeated sabotage attacks on facilities in the north," said Mohamed Zine, IHS regional manager for the Middle East.
"This has resulted in a current production capacity of two million barrels of oil per day."
Mr Zine explained that the Iraq Atlas had suggested that a "stable political and civil environment" could enable Iraq to produce an extra four million barrels a day in the immediate future.
If Iraq was able to produce more than 216 billion barrels of oil every year it would overtake Saudi Arabia as the world's largest producer of the raw material.
IHS says that prior to the US-led invasion of Iraq in 2003, the country was producing 2.7 million barrels per day, compared to 3.6 million prior to the country's conflict with Iran in the 1980s.
A sharp fall in Iraqi oil exports to America in February
April 21th 2007
American Ministry of Energy said that Iraqi exports of crude oil to the United States in February fell to its lowest level in three and a half years.
The latest government data on oil trade this week showed that Iraq had exported 325 thousand barrels per day of crude oil to the American market in February, which is 39% below of what it was the previous month.
The Ministry of Energy said that this was the least amount of crude oil exported by Iraq to the United States since September 2003. The Ministry did not explain the reason for the sharp decline of Iraqi oil exports.
The United States imported an average of 553 thousand barrels per day of crude oil last year from Iraq, which made it the sixth-largest foreign supplier of oil to America.
The Iraqi oil law is discussed in Dubai
April 21th 2007
Some 60 Iraqi parliamentarians and oil experts arrived in Dubai on Tuesday to hold a meeting on the law of oil which Iraq intends to legislate for a long time.
An official working with the Iraqi Parliament said, "Members of the Iraqi Parliament will meet with technical experts to discuss the oil law in Dubai away from the political influences in Baghdad".
The official, who was speaking to journalists in Dubai, said that the meeting will be held on Wednesday. Some experts and professionals residing in third countries refused to travel to Iraq for security reasons. The official added that three Iraqi ministers at least will attend the meeting; one of them will be the Oil Minister, Hussein Shahrastani who arrived to Dubai earlier on Tuesday but refused to speak to reporters upon arrival.
In February the Iraqi Cabinet adopted a draft law to regulate the sharing of wealth from the vast oil reserves in the country among ethnic groups and creeds.
The oil law, which awaits parliamentary ratification, grants regions the right to negotiate with international companies to exploit the oil fields.
Shahrastani said earlier this month that it is possible to pass the law within two months because all political parties support it.
The law restores restructuring the Iraqi National Oil Company to become an independent holding company and maintains a federal forum for the oil policy on the national level.
Many major oil companies in the world have been trying for years to win a share in the distinctive Iraqi oilfields like: Bin Omar, Majnun, Nasiriyah, West Qurnah and Artawi, which are all in the south of the country.
Iraq says it aims to increase oil production to more than four million barrels a day in 2011. According to a survey conducted by Reuters Iraq produced 1.97 million barrels per day in March, up from 1.89 million barrels a day in February.
Shahrastani said last December that the average 2006 production was 2.3 million barrels a day.
Iraq which is a member of OPEC owns, for certain, the third largest oil reserves in the world and needs billions of dollars to revive this important sector in order to rebuild its faltering economy.
Iraq's economy
April 21th 2007
The announcement of a study that suggests that Iraq's oil reserves could be almost as large as those of Saudi Arabia, the world's leader, has come amid fresh evidence of the monumental difficulty of realising that potential, as bombs in Baghdad left 200 people dead in a single day and Iraqi MPs wrangled over the details of new oil legislation.
The reminder of the scale of Iraq's unrealised oil wealth has come in the form of a report by IHS, an industry consultant, providing details of existing oil reserves and of more than 400 undrilled prospects and undeveloped discoveries. The Iraq Atlas estimates that Iraq has proven reserves of 116bn barrels (slightly higher than the standard industry figure), which could be supplemented by a further 100bn barrels in the barely explored desert region to the west of Baghdad. Saudi Arabia's reserves are put at 264bn barrels, with Iran occupying second place in the world ranking with 138bn barrels.
The IHS study confirms what most analysts of the Iraqi oil sector have long suspected. The giant oilfields discovered in the Kirkuk area in the north in the 1920s and in the southern region in the 1950s required the drilling of relatively few, shallow, wells, and there was consequently little incentive for major exploration and development efforts to be deployed elsewhere. The seizure of power by Saddam Hussein at the end of the 1970s ushered in a period of wars and sanctions that prevented any significant development of the Iraqi oil sector for more than a quarter of a century. Iraq's oil production capacity has fallen from a peak of 3.6m barrels/day to little more than 2m b/d, as the industry has suffered a further battering in the chaos and violence of the post-Saddam era. Iraq has the dubious distinction of having the highest reserve/production ratios in the world.
Since the US-led invasion in 2003 there has been only limited exploration drilling, mainly in the Kurdish region, and just three contracts have been let for existing oilfield development work—to Turkish and Canadian firms in the north and to Ireland's Petrel Resources in the south. These three schemes will add a total of some 350,000 b/d of production capacity by 2009. Further progress awaits an improvement in the security situation and the establishment of a robust legal framework that will allow foreign companies to invest.
Kurds object The civil conflict that continues to tear Iraq apart has not stopped the government from addressing the critical question of passing a new oil law. In February the cabinet approved a draft law, allowing provincial authorities to negotiate development contracts, subject to review by a Federal Oil and Gas Committee. The oil minister, Hussein Shahristani, has said that the law will be submitted to parliament for final approval in the next few weeks. However, the Kurdish Regional Government (KRG), which has attracted strong interest from international companies to explore for and produce oil in its relatively secure region, has voiced its objections to a number of items in annexes attached to the law since it was passed by cabinet. According to remarks attributed to its chief oil official, Ashti Hawrami, the KRG has been particularly exercised by the placing of virtually all of Iraq's oilfields under the control of the Iraqi National Oil Company (INOC, which is to be re-incorporated under another law likely to be passed as part of a package, also including a law on distributing oil revenue to Iraq's 18 provinces based on population). This would have a damaging impact on the production-sharing contracts that the KRG has already signed and on new agreements that are under negotiation.
The KRG has been anxious to ensure that the law is sufficiently flexible to deal with the very different conditions obtaining in its region, compared with the rest of Iraq. In Kurdistan, investors are taking on considerable exploration risk, which does not apply to the numerous fields elsewhere in Iraq that have been discovered but not developed. The law requires the KRG to submit its contracts for review, but this process could be compromised if the fields in question are designated as being under INOC control in the annexes (which have yet to be published). The law itself provides for a number of commercial frameworks, including service contracts, exploration and development contracts and risk exploration contracts. It also recognises the need to provide adequate returns and incentives to investors, within the context of best serving the national interest.
According to Al Hayat, a London-based Arabic daily, one of the annexes specifies the different categories of fields. These include 27 in production and 25 close to production, all of which come under INOC's remit, as well as 26 that have been discovered but not exploited, which will be offered to investors and contractors. The annexes also provide details of 65 blocks to be offered for exploration, according to Al Hayat.
Mr Shahristani suggested that any remaining differences about details of the law can be ironed out by the end-May deadline for its passage. However, persuading international companies and financiers to commit resources to Iraqi oil projects in the current political and security circumstances will be another matter entirely.
New Findings Peg Iraq's Oil Reserves At 200 billion Barrels
April 21th 2007
Iraq may have untapped oil reserves of over 100 billion barrels on top of a known reserve base of 116 billion barrels, making Iraq the world's potential top oil producer, says an IHS Inc. report. According to IHS's rankings, Iraq ranks third in known oil reserves, behind Saudi Arabia and Iran.
The consulting firm in a comprehensive report released Wednesday said the untapped oil reserves mainly lie in the western part of the country.
Describing the oil reserves a "gold star opportunity," president and chief operating officer of IHS Ron Mobed told reporters the security situations need to improve drastically to let the country exploit the potential. "Obviously the security side is a big question," Mobed remarked.
According to the IHS report Iraq's two main oilfields, at Kirkuk in the north of the country and Rumaila in the south, were operating below capacity due to damage caused by the war and previous sanction regimes.
Iraqi's highest oil production was in 1979 at an average of 3 million barrels a day. The country could not realize its target of pumping 3.5 million barrels a day set back in mid-2006. So now the daily output stands at two million barrels per day, down from three million barrels in early 2003. "It could rise to four million barrels by 2012 if the conflict subsides and new investments in oil infrastructure are made," the IHS report said. It also said the output could be raised to six million barrels in the future.
IHS said its experts conducted a field-by-field analysis of Iraqi oil prospects and the finding would be released next month in full detail.
Turkey to increase trade with Iraq to $3.5b
April 15th 2007
(MENAFN) Turkey's State Minister for Foreign Trade said that the government is looking to increase joint trade with Iraq to $3.5 to $4 billion and business volume from $7 billion to $10 billion this year, Iraq Directory reported.
The Turkish minister, who was addressing a press conference, also stated that strengthening economic ties with Iraq is among the Turkish government's top priorities.
It is worth mentioning that The Head of the Iraqi Commerce Ministry Department of Affairs said that the relations between Turkey and Iraq will not be effected by political statements made by some Kurdish leaders.
Kuwait's MTC in talks for Iraq licence
April 15th 2007
Reuters
Kuwait's Mobile Telecommunications (MTC) is in talks with Iraq to get a long-term mobile phone licence, the firm's managing director said in comments published yesterday.
MTC, the third-largest Arab telecom company by market value, operates MTC Atheer in Iraq. Kuwaiti papers had reported in January that the company's licence would expire on March 31, after a three-month extension.
MTC now wants to get a long-term licence, Saad Al Barrak told Al Watan daily.
Kuwait's Wataniya and Cairo-based Orascom Telecom also operate mobile phone providers in Iraq.
The majority shareholder of Wataniya's Iraq affiliate Asia Cell has applied to a court to shut down the firm.
Chevron confirmed as key sponsor of Iraq Oil, Gas, Petrochemical & Electricity Summit
April 15th 2007
Chevron has confirmed its role as a sponsor of the forthcoming Iraq Oil, Gas, Petrochemical & Electricity Summit, which will take place on 28-30 May 2007.
The summit has been organised to bring together key Iraq Government decision makers in the energy sector and international operators seeking partnership opportunities in both the upstream and downstream industry.
The summit will welcome representation from the Iraqi Ministries of Oil, Industry & Minerals and Electricity, as well as the Iraq Energy Council, Investment Promotion Agency and the Kurdistan Regional Government (KRG) Ministries for Natural Resources, Industry and Electricity. It will also host many of the state companies operating under the Iraqi Ministry of Oil and senior representatives from the Iraq Reconstruction Management Office (IRMO).
This historic landmark event will be the first of its kind for the most important sectors of the Iraqi economy.
Chevron Corporation is one of the world's leading energy companies. With approximately 56,000 employees, Chevron subsidiaries conduct business in approximately 180 countries around the world, producing and transporting crude oil and natural gas, and refining, marketing and distributing fuels and other energy products. Chevron has been a partner in the Middle East for over seven decades with major operations currently in Saudi Arabia, Kuwait, and Qatar.
With the world’s second largest proven oil reserves, Iraq is well positioned to be a major contributor to global energy markets. International companies have the unique opportunity to help Iraq rebuild and develop its energy resources for the benefit of the Iraqi people. With the recent developments around a national hydrocarbon law, the timing of the summit could not better.
The Times:Turkish deal could pave way for Shell's return to Iraq after 35 years
April 15th 2007
Shell is poised to become the first oil and gas major to agree terms to reenter Iraq following reports that it has struck a deal with Turkey’s state oil company, TPAO, to extract gas in the war-torn country, the Times said. The report went on to say that, “The Anglo-Dutch giant is expected to work in partnership with TPAO to build a pipeline from the Kirkuk field near Kurdistan to Ceyhan on the Mediterranean, according to reports. A spokesman for the Turkish Energy Ministry said: “An agreement has been reached which has to be ratified by the administration in Baghdad.” Shell refused to rule out an agreement with TPAO but insisted there was still no legal framework in place in Baghdad to allow any contracts to be issued to foreign companies. Ian Bromilow, Shell’s chairman for Iraq, told The Times: “We have discussions but the contents of those discussions are really quite confidential.” “It is still very, very unclear what will happen in the sense that there is no petroleum law in place and the issue of security,” Bromilow said. Iraq has some of the biggest oil and gas reserves in the world and speculation about Shell’s involvement has mounted in recent weeks. The oil major has long expressed an interest in returning to the country after being forced out when the industry was nationalised in 1972, and signed a memorandum of understanding to develop a plan for Iraq’s gas infrastructure in 2005. Last month industry in-siders claimed Shell managers met Iraqi officials in Oman to discuss investment terms for any future deals. The Iraqi Parliament is due to debate a draft Petroleum Law soon. Ratification would open the doors to billions of pounds of foreign investment.
Iraq Targets 3 Million Bpd 2007 Oil Production -Oilmin
April 15th 2007
Global Chemical Network
Iraq hopes to raise oil production by nearly 1 million barrels per day (bpd) this year, achieving its long-held target of 3 million bpd by restoring northern exports, its oil minister said on Thursday.
Iraq has struggled to overcome the sabotage and outdated infrastructure that has hobbled its production since the U.S.-led invasion of 2003, largely due to unrelenting attacks on a key pipeline that runs north through Turkey.
It has regularly fallen short of production and export targets aimed at restoring pre-war levels.
"Iraq wishes to exceed producing 3 million barrels a day in 2007 -- this is achievable by repairing the northern pipeline that connects to the Mediterranean," Hussain al Shahristani told Reuters after a meeting with South Korean energy officials.
Iraq produced 1.97 million bpd in March, up from 1.89 million bpd in February, a Reuters survey shows, but Shahristani said last December that 2006 production averaged 2.3 million bpd.
Despite the weak production figures, exports climbed last month to 1.62 million bpd, the highest since last September, on increased shipments from the southern Basra oil terminal, shipping sources said.
Shahristani said the country was targeting oil production of more than 4 million bpd in 2011.
Shahristani was in Seoul to sign a cooperation deal with South Korea's energy minister Kim Young-joo on broadening opportunities for South Koreans to secure oilfields in Iraq, anxious to inject new investment into the ailing industry.
In 1997, state-owned Korea National Oil Corp. (KNOC) and Iraq's oil ministry under Saddam Hussein signed a preliminary deal to develop the Halfaya oilfield, estimated to hold up to 3.8 billion barrels of reserves and produce 250,000 bpd.
The South Korean energy ministry said the deal was never followed through due to United Nations financial sanctions against Iraq. But Iraq will "positively consider" involving South Korea in the field once oil legislation is in place, according a memorandum of understanding signed by the two sides on Thursday.
Iraq issued invitations for 15 Arab, Asian and American firms to drill 100 oil wells in the country's south as part of efforts to boost production, the oil ministry said earlier this month.
The OPEC member has the world's third-largest proven oil reserves and needs billions of dollars to revive its oil sector, which is crucial for rebuilding its shattered economy.
In February Iraq's cabinet endorsed a draft oil law regulating how wealth from the country's vast oil reserves will be shared by its ethnic and sectarian groups.
The oil law, which is awaiting parliament's ratification, has given the regions the right to negotiate with international firms on developing oilfields.
"It is achievable to pass the law within two months since all political parties are in favor," Shahristani said.
The law will also restructure the Iraq National Oil Company (INOC) as an independent holding firm and establish a Federal Council as a forum for national oil policy.
The world's top oil companies have been maneuvering for years to win a stake in Iraq's prized oilfields such as Bin Umar, Majnoon, Nassiriyah, West Qurna and Ratawi, all located in the south of the country.
Japan pledges support to rebuild Iraq
April 9th 2007
TOKYO (Reuters) - Japan assured the visiting Iraqi prime minister on Monday it would keep helping his country to rebuild, as Iraqis back home staged a big anti-U.S. protest in the city of Najaf on the fourth anniversary of Baghdad's fall.
"There is no change in our policy to actively help with the reconstruction of Iraq through official development assistance and activities of the Self-Defence Forces," Japanese Prime Minister Shinzo Abe was quoted as telling Nuri al-Maliki.
"We want to forge a long-term strategic partnership," a government official quoted Abe as saying. Earlier in the day, Maliki told Defence Minister Fumio Kyuma that Iraq hoped to see Japanese firms return to the country soon, a Japanese official told reporters.
"We hope the security situation becomes stable quickly so that both Japan's government and businesses will be able to make more contributions," the official quoted Kyuma as replying.
Baghdad spent Monday's anniversary under curfew, but tens of thousands of marching Iraqis, mostly men and young boys, staged a peaceful rally in the southern Shi'ite holy city of Najaf, chanting "No, no to the occupation, no, no to America".
Sadiq Al-Rikabi, a senior adviser accompanying Maliki, brushed off concern over the protest, saying Iraqis should be allowed to express opinions if it was done peacefully.
The Russian Look-Oil request political support to Iraqi oil deal
April 9th 2007
Look-Oil company, the largest oil producer in Russia, entered a partnership agreement with the Ministry of Foreign Affairs on Monday, and said that it depends on its support in preparing for the rehabilitation of a giant oil deal in Iraq.
Look-Oil and the ministry said in a statement that the agreement is the first of its kind in Russia, and it aims to support Look-Oil projects abroad and defend the interests of the company through diplomatic means and facilitate meetings of the company abroad.
In its turn, Look-Oil would consult with the ministry in energy-related issues.
The Russian news agency Interfax reported that head of the company, Wajid Ali Kabeerov, said at the signing ceremony which foreign media journalists were prevent from from attending it, "our company is entering new areas which do not enjoy political stability. We will need the support of the ministry in Iraq, particularly".
The head of the company said last month that his company is optimistic about the prospects for reviving a deal since the era of former Iraqi President Saddam Hussein to develop the giant Iraqi field of West Qurna after the government approved the new Iraqi oil law.
The deal, worth four billion dollars, to develop the West Qurna field may face problems due to its cancellation by the government of Saddam just before his overthrown in 2003.
However, the new oil law still needs to be approved by the Iraqi Parliament, which aims to establish the general framework of the work of foreign companies that invest in Iraq after decades of sanctions in the era of Saddam and the years of violence since the invasion, led by the United States.
"Q-Tele" intends to withdraw from Iraq
April 9th 2007
Qatar Telecom Company (Q-Tele) said that a court had received a request to close Asia-cell the Iraqi mobile phone company which a unit of Q-Tele owns 40% of the shares in it.
Q-Tele owns the share of the company through the Kuwaiti Mobile Telecommunications Company, Al-Watania, which purchased the majority of the shares last month at 3.72 billion dollars to expand its global work.
Asia-cell, registered in the Cayman Islands, contributed at about 49.7 million KD ($171.8 million) of the net profits of Al-Watania in 2006, which reached 73.2 million KD.
Q-Tele said in a statement posted on the Doha Stock Exchange website on the Internet that a petition to liquidate the Asia-cell company was recently presented to the courts of Cayman Islands by the biggest stockholder in the company; however, the statement did not mention the reason of the petition.
Harry Koponan, Executive Chairman of Al-Watania, said last February that Asia-cell contributed in about one quarter of the number of subscribers in Al-Watania last year. Asia-cell was founded in 1999 and has more than three million subscribers in Iraq, according to its website.
Mark Hamond, communications prominent analyst and Assistant to the Deputy Chief of Research at Capital Ray, said: "operations in Iraq contributed significantly to the results of Al-Watania work".
He continued that Q-Tele will deserve compensation if it closed its work in Iraq in accordance with the agreement to purchase Al-Watania.
He went on to say that Kuwait Projects Company (KEPCO), which led the consortium which sold the share to Al-Watania, will pay any compensation.
Japan lends Iraq 102.8 bln yen for oil export facility
April 9th 2007
TOKYO (XFN-ASIA) - Japan has forged an agreement with visiting Iraqi Prime Minister Nuri al-Maliki to lend Iraq 102.8 bln yen for the development of its oil sector.
The Japanese low-interest loans will fund the construction of an oil export facility, with oil putput in the country having slumped since the US-led invasion that toppled Saddam Hussein four years ago.
Maliki was making his first visit to Japan and South Korea, two key economic partners of Iraq, which have both sent troops to help with reconstruction of the nation.
Under the terms of today's deal, the loans to Iraq will be repayable over 40 years with a 10-year grace period at an interest rate charge of 0.75 pct a year.
The money will go to build the oil facility connecting pipelines in the southern province of Basra. It will also fund fertiliser and oil refinery plants and help improve electricity, a Japanese foreign ministry statement said.
The loan is part of 6 bln usd in debt waivers and 1.5 bln usd in aid which Japan announced for Iraq in 2003. Much of the aid is on hold due to concerns about instability.
Italy, Poland offer civil economic, security support
April 8th 2007
Al Sabah
Italy had presented a simplified loan rated about 400 millions Euros. Meanwhile, Poland had expressed readiness to offer assistance on military, civilian and economic aspects.
Two separated statements issued by the bureau of the deputy prime minister Braham Salah that he received on April 5 the Italian deputy foreign minister and the accompanying delegation, as well as the Poland National Defence Minister and the accompanying delegation. During the meeting, talks had been held, tackling the cooperation aspects among Iraq, Italy and Poland.
Generating electricity from solar energy
April 3th 2007
Head of the Reconstruction Committee in Baghdad City Council, Ali Al-Attar, said that the Council is doing an extensive study for the endorsement of the project of generating electricity from solar energy.
Al-Attar said that: “the purpose of generating electric power by relying on solar energy is to reduce dependence on fuel and manufacture machines like geysers, heaters and others, then sell them to citizens at prices subsidized by the government”; he added that: “the Reconstruction Committee gave priority to projects, for the current year, which directly affecting the lives of citizens, such as electricity, water, sanitation, health and education”.
Oil flowing to Jordan within months
April 3th 2007
ffairs, Shirwan Alwaeli, said that an agreement was concluded with companies operating under the private sector to protect the roads linking between Iraq and Jordan, with the aim of raising the volume of trade exchange, and start transferring the expected amount of Iraqi oil to Jordan. Alwaeli said that the current security situation deferred supplying Jordan with the oil agreed at between the two countries, of 10 thousand barrels, accounting for 10% of Jordan’s consumption of crude oil per day, but efforts are being made to protect the road between Amman and Baghdad.
Alwaeli announced that Iraq is about to operate a railroad with Syria and establish another one with Iran. Iraq has sent a technical delegation to Jordan last year to study the economic feasibility of the designs and preparations to start the project, and announced later the completion of all the studies and designs necessary.
The Iraqi minister said it is likely that Iraqi planes parking as "scrap" in Amman International Airport since the outbreak of the Gulf War in 1990 will be sold. Jordan announced in December 2005 the exemption of Iraq from the fees of parking for the entire period during which the aircraft remained in its territory, which is estimated at about four million dinars.
Divergent views of experts in the energy sector and economists on the ability of the Jordanian government to liberalize this sector, as it announced earlier.
Deputy Prime Minister, Minister of Finance Ziyad frez, said that the government had reached the point of the tie in supporting fuels, following a series of measures it took within the strategies it adopted to support citizens rather than goods.
Workers in the energy sector said that the government needs to follow practicle procedures in the process of liberalization of the sector, according to studied methods to maximize the Treasury when granted licenses for the importation of oil, in order to avoid the experience of the telecommunications sector, which has cost the Treasury huge sums of money.
Former Minister of Energy and Mineral Wealth, Muhammad Bataineh, said that the liberalization of the energy sector requires several operations precede decision-making, both at the port, stores or logistical aspects and transport fleet, but some of them are not ready yet, and this undermines the capacity of completing the liberalization of this sector.
The government announced its intention earlier in the formation of a body to regulate the energy sector with the task of monitoring the market pricing policies.
And according to the statements of government officials, the liberalization of the energy sector will be at the beginning of next year, but speculation about the seriousness of these statements are subjected to the actions actually taken, according to the president of gas stations Adnan Urabi.
Economist, Hani Al Khalili, demanded the government to keep their hands on the sector while ensuring the stability of the situation, especially since world prices are subject to change without logical reasons and are being biased to speculations.
On his part, economist, Mazin Marji, explained that the government had passed tough decisions on the population, to increase fuel prices, or taxation, as it breached previous promises it made to reduce fuel prices if global prices retreated, but it did not.
Electronic circulation in the Iraqi securities market
April 3th 2007
raqi securities market announced that it registered the companies which are registered in the market in the International Numbering Agency. The Executive Director of the market, Taha Ahmad Abdul Salam, said that: “one of the important steps done by the Iraqi securities market, for the purpose of implementing the electronic circulation, is the registration in the International Numbering Agency which will enable international investors from trading through more than one intermediary”.
He added that:”this step will eliminate the problem of delays in issuing the shares certificates, which the local the market and investors suffer from with the possibility of delivering the value of the shares on the day following the transaction session without any delay from the clearing bank”.
Iraq to import refining equipment from Iran
April 2th 2007
Iraq will pay $64 million for importing equipment from Iran to upgrade one of its refineries.
The equipment will be imported to upgrade Najaf Oil Refinery located in 150 km south of Iraqi capital city of Baghdad, a provincial official of Najaf has said.
A provincial delegation from Najaf has visited Iran where they talked with exporting Iranian firms over the issue, Ali al-Esaavi said without referring to the date of the Iraqi trip.
Najaf Oil Refinery was opened near the Shia shrine city of Najaf with a modest capacity of 10,000 barrels per day early October 2006.
Standing as the second refinery opened by Iraq's oil ministry since April 2003, it is aimed at meeting the local needs of the inhabitants and factories of Najaf province.
The Najaf refinery project was started at the beginning of 2006 and took nine months for completion. Its builders say plans are in place to install new production units to expand capacity.
After the collapse of former Iraqi dictator Saddam Hussein, Iran and Iraq have taken measures to expand mutual ties in different fields.
In addition to cooperate on refining sector, Tehran and Baghdad have electricity exchanges as well.
According to Iranian Energy Ministry, Iran currently exports 150 MW of electricity to Iraq per day, which may increase in future, based on a request by the Iraqi side.
Iraq has also proposed Iran to help construct power plants in Iraqi region, which is being assessed by Iranian officials at the time being.
Furthermore, Bank Melli Iran (BMI) will open a branch in Baghdad and other cities southern Iraq, which is a move to boost banking ties.
The signing of a memorandum of understanding (MOU) early March during a visit of an Iraqi ministerial delegation to Iran is another measure of Tehran and Baghdad to develop bilateral ties.
A Fair for (catalogs) of 21 American and European companies in Babylon
April 2th 2007
The Center of developing Iraqi economy in Babel organized an exhibition for catalogs of 21 American and Western companies to support the Iraqi economy and open the way for Iraqi traders to join foreign companies in various construction and service projects, in the first experiment of its kind in Central Euphrates.
The Board chairman, Salah Bahiyah, said that the idea of organizing an exhibition for companies’ catalogs came to substitute organizing an exhibition for the products of these companies, which the Center intended to hold in Babylon, pointing out that a number of security constraints, as well as lack of resources in Babylon to host exhibitors from different countries of the world prevented holding the exhibition.
He said the Center contacted a number of companies and agreed with them to send their catalogs and that 21 companies have responded to that. On the other hand, the Center called a number of traders and Iraqi businessmen to attend the exhibition in order to open channels of partnership between them and the participating international companies.
He pointed out that Iraqi investors need the international expertise in the fields of reconstruction and investment, particularly in the sectors of agriculture and industry, which had suffered from neglect and deficiency due to the lack of local expertise and potential problems caused by the policies of the former regime, pointing out that the objective of introducing new methods in reconstruction projects focused on the adoption of the prefabricated constructive way that commensurate with the technical possibilities available in Iraq; at the same time stressing that this type of business needs international expertise to be involved with the Iraqi investors in order to provide them with technique and finance.
On his part, Alaa Harba, member of the Center, confirmed the need for the local administration in Babylon to include within their current plans building a hotel or guest hall to accommodate commercial delegations, which are expected to host in Babylon, pointing out to the need of maintaining such kind of projects that commensurate with the need of the province for sewage, water and electricity projects.
He said that the lack of a tourist facility for housing the delegations had canceled the exhibition of Iranian goods which the Center intended to set up in Hilla, compelling the Center to replace it with the current exhibition, hoping that conditions in future may facilitate holding international exhibitions to make it possible for Iraqi capital owners to open up to international companies. The opening of the exhibition, which lasted two days, was attended by Head of the Contractors Federation in Karbala, as well as a number of merchants and capital owners representing the Central Euphrates provinces.
Iraq, US sign economic accord
March 25th 2007
MENAFN
(MENAFN) The Iraqi Minister of Industry announced that the Iraqi authorities and the American Ministry of Defense have signed an accord to improve the industrial sector in Iraq, Iraq Directory reported.
The accord aims to find ways of cooperation between the industrial sector in Iraq and the international community through setting several collaborations between Iraqi businessmen and their international and American counterparts, thus contribute to the economy of Iraq and solve the issue of unemployment among Iraqis, he said.
The agreement, then, includes the expansion of the production capacity of many companies and factories related to the Iraqi Ministry of Industry from 25 percent capacity to 80 percent through providing these plants with facilitated loans that are estimated to $6 million, he explained.
He added that the factories, thus, would expand their production lines gradually particularly after the American party has announced that it will open the international market to these products through attracting the investors to buy the goods at good prices and in a profitable way.
