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World Bank Targeting Iraq For Contributions

by admin ~ December 25th, 2012

Based on current Iraqi Dinar newsreports, Iraq’s oil industry is one of the world’s strongest today, producing millions of barrels of oil on a daily basis. And with several noteworthy experts and organizations predicting the Middle Eastern country’s output to increase over the decades to come, more investors – interested in purchasing Iraqi Dinarnotes to invest in oil and other sectors conducive for investments – are becoming drawn to this nation.

The predicted increased output of the country’s most marketable product has also caught the attention of World Bank, which is an international financial organization dedicated to the alleviation of poverty through the extension of special loans for developing countries to establish capital programs.

According to a representative of Iraq’s Central Bank, the World Bank asked Iraq to become a donor state by the year 2014. Although this Middle Eastern country’s oil sector is doing quite well, and is predicted to do even better within the next few years, the Iraqi economy’s legs are still somewhat maimed by the adverse after-effects of war.

“Poverty is still rife in Iraq. Iraq continues to be a potential conflict zone. There are regular bombings in the country,” says Paul Sullivan, an economics professor at National Defense University (NDU).

Sullivan, who is also an adjunct professor of security studies at Georgetown University, has long been studying the recuperation of Iraq. He points out that this country has several problems of its own to worry about at present, such as the need to rebuild infrastructure and initiate health care programs.

Iraqi Dinar newsreporters quote Sullivan explain how the Iraqis have an abundance of oil revenue lying around, yet they’re never fully utilized because of corruption, inadequate governance, poor rule of law, and other detrimental factors.

“The World Bank is less than clueless if they think Iraq is ready to be a donor state,” says Sullivan.

On the other hand, Majid al-Sadi, current head of the Iraqi Business Council, believes that this nation will be ready to become a donor state as soon as the oil output rises. “Iraq since its inception has always been a donor county,” he says.

He then explained how Iraq extended billions of dollars (which basically amounts to trillions when converted to Iraqi Dinarcurrency) to other countries in need of financial aid, including Jordan, before the 2003 invasion.

Iraq and Armenia Strengthening Ties Through Mutually Beneficial Projects

by admin ~ December 23rd, 2012

While Iraq may currently be having icy relationships with other countries, it still continues to exert efforts to rehabilitate the damaged ties through the continuance of joint projects. At the same time, Iraqi Dinar newsreports state that the Middle Eastern country’s government officials are meeting with representatives of other countries in an attempt to foster healthier affiliations, as well as venture into the possibility of creating joint ventures, which should be mutually beneficial for interested participants.

Dinarreporters say that Armen Gevorgyan, the Deputy Prime Minister, Minister of Territorial Administration, and co-chair of the Armenian-Iraqi Intergovernmental Commission engaged a series of meetings with Iraqi officials during the first week of November.

A number of concerns were brought up during discussions, including that centered on widening bilateral cooperation. In a statement to the press, the Information and Public Relations department of the Ministry of Territorial Administration, potential joint cooperation with the Iraqi Railways board representatives were explored, which in turn should gradually benefit both countries.

Crucial information on the current state of the country’s railway systems, as well as long-term development plans, was presented by Iraqi officials during the meeting. Gevorgyan was said to have given positive feedback, and then decided to further discussions on the Iraq-Armenia railway project, which is believed by many to bring forth massive opportunities in terms of cargo transport.

The initial meeting was met with success, as a mutual agreement – concerning the materialization of bilateral conversations – has been reached. Suggestions tied to united ventures will be brought up during future meetings, and in turn should eventually become a reality if all goes according to plan.

In addition, another meeting was held between Iraq’s Minister of Oil Abdul Karim al-Luabi and the Armenian Deputy Prime Minister. Both sides had brought up several deliberations pertaining to cooperation related issues on energy and natural resource, as well as the potential profits to be made through possible joint operations.

During the meeting, dinarreporters say the two interlocutors jointly highlighted an agreement which was reached for the Intergovernmental commission to review.

As Armenia seeks to engage the profitable oil industry in Iraq, Iraqi Dinar newsreports say that new contracts has been awarded to other giant oil companies from different countries over the past year. While there’s a relatively long roster of participants, some of the most notable corporations operating within Iraq today include Russia’s Lukoil, Japan’s Inpex, and Kuwait Energy.

Iraq’s Signature Dish Masgoof Enjoyed By Locals Once Again

by admin ~ December 21st, 2012

Iraqi Dinar newsreports have described rampant communal war across Iraq in the past, and how its repercussions caused drastic impacts on the economy – including the value of dinar currency – as well as the lifestyle experienced by locals.

However, despite the levels of violence remaining relatively high, analysts note that the intensity and frequency of these battles have dropped over the past few years. This in turn gives locals, such as Abu Shahad, the confidence they need to go out once again and enjoy Iraqi specialty dishes, such as the nation-wide renowned cuisine, Masgoof.

“This fish is part of Baghdad’s heritage, part of the heritage of the south, the west of Iraq,” he says. The Iraqi then goes on to explain how the decreased occurrence of bloodshed has made him, as well as his close buddies, more relaxed when dining at restaurants or unwinding at cafes.

Of course, Shahad isn’t the only one who’s feeling safer about going out and dining with friends. Statistics show that the number of Masgoof – which is essentially a mouth-watering flame-grilled carp — sold is significantly increasing everywhere, meaning plenty of other citizens are now coming out of their homes to enjoy hearty meals.

“During the sectarian tensions, we would hardly sell 10 fish a day,” says Hashim Murshid, the owner of Khadra restaurant in northern Baghdad where Abu Shahad and his pals were spotted dining. “But now, we serve around 100 fish a day,” he added.

Restaurants located along the banks of Tigris River are also receiving more customer traffic from Iraqis braving the decreased dangers posed by unpredictable outbreaks of war. Citizens interviewed have noticed that the smell of freshly grilled fish, as well as vapors from flavored water pipes customers puff on as they dine, has once again filled the air.

According to Iraqi Dinar newsreporters, the preparation of Masgoof is quite interesting, and has served well in attracting both locals and tourists to place orders. Upon arriving at a restaurant, customers are prompted to select the carp he or she would like to eat from the fish pond.

The carp is then killed with a sharp blow to the head, and sliced into two afterwards. From there, it is seasoned with a combination of spices, onions, plus tomatoes sauce, and finally grilled in front of an ember-filled pot.

Customers are charged $33 (40,000 dinars) per order, which basically makes it relatively expensive considering how the value of dinaris quite low in comparison to the US dollar.

Iraq’s Potential To Become The World’s Largest Oil Exporter

by admin ~ December 19th, 2012

There’s no doubting the Iraqi Dinar newsreports which tout Iraq’s oil reserves as one of the largest in the world today. Considering how this Middle Eastern country’s economy is almost entirely oil-based in its own right, people would expect that the Iraq has giant infrastructures and labor forces working on its oil fields round the clock to spin out massive supplies of oil.

Surprisingly, this isn’t the case, as observers of the Iraqi Dinarcurrency, who also habitually keep an eye out for oil-related activities, say that this nation is hardly even scratching the surface of its true potential. There aren’t enough developers, infrastructures, or a large enough workforce at present to drastically bump up production to the levels seen amongst top oil producers.

To put things in perspective, Iraq had an estimated 2000 wells spread throughout the country back in January of this year – a figure that hasn’t changed much over the past ten months. On the other hand, the state of Texas had more than a million oil wells – despite the fact that Texas’s oil reserves pales in comparison to that of Iraq — during the same period of time.

Of course, the Iraqi nation intends to significantly increase their productivity over the course of time, as the Ministry of Oil has made several announcements regarding plans to increase output to 12 million barrels per day (mbpd) on or before the year 2017. If so, the 300 percent increase could finally secure this country the number one spot for largest oil exporter, leaving the current reigning champion, Russia, in the dust.

On the other hand, the US Energy Information Administration (IEA) came up with a different prediction, saying that the country would most likely increase its output to 6.1 mbpd by 2020.

Whichever of the two predictions come true, one thing is for certain: massive expansion projects like the two described earlier will require extensive infrastructures to be created, as well as a significantly larger workforce, which could amount to over $200 billion (over 233 trillion when converted to Iraqi Dinarcurrency.)

However, according to Iraqi Dinar newsreports, oil companies have to do more than just come into the Middle Eastern country armed with billions of dollars. Since most of the U.S. troops have been pulled out, corporations have to be extra careful not to further the rift between the West and Iraqis.

Kentz Wins $55m Iraq Contracts

by admin ~ December 18th, 2012

Kentz has announced the award of three individual, reimbursable, service contracts in Iraq with a total value to the company of circa US$55 million, through its Technical Support Services business unit.

Across the three projects, Kentz will provide services over the next three to four years that will oversee the development of in-plant process facilities and infrastructure to deliver a combined increase in production capacity of approximately 250,000 bpd of oil and 300 million standard cubic feet of gas. Kentz will be working on both new and existing upstream facilities, based in the Basra and Baghdad areas.

The scope of services to be provided include project management, front end engineering, procurement and installation supervision support for three oil and gas facilities. Kentz will draw resources from offices in Basra, alongside Abu Dhabi, Dubai, and Saudi Arabia.

Kentz first commenced operations in Iraq in 1981 and in August 2010 announced that it had reached agreement to acquire an interest in Dome General Contracting Company Ltd. (Iraq); a leading supplier of services to Iraq’s energy sector. The awards announced today are in-line with Kentz’s stated strategy to grow its presence in the Iraqi hydrocarbons market.

Mike Murphy (pictured), Chief Operating Officer, Technical Support Services for Kentz, commented:

We are delighted to have been awarded a succession of new contracts in Iraq, which underpin our continued focus on the Middle East region and the opportunity that we highlighted to the market.

“Iraq has the third largest proven oil reserves in the world and Kentz is well positioned to support key clients through in-country resources and a proven track-record of delivery, backed up by a global supply network of engineering and procurement resources.


Iraq Seeks Pipeline Investors

by admin ~ December 17th, 2012

At a roadshow in London today, Iraq sought investors for two new oil pipelines:

  • A 2.25-million bpd line from Basra to the pumping station at Haditha, to be built on an EPC (engineer, procure and construct) contract; and,
  • A 750,000- to 1-million bpd line from Haditha to the port of Aqaba in Jordan, on a 20-year BOOT (build, own, operate, transfer) contract .

Bloomberg quotes Deputy Oil Minister Ahmad Shamaa [Ahmed al-Shamma] (pictured) as saying that timing of the construction depends on the response from investors, and that the government hopes to complete financial backing for the project by the end of next year.

There are also plans for a second export pipeline through Syria with a capacity of 1 million barrels once unrest in the neighboring country ends.


Iraq’s Energy Sector To Undergo A Green Facelift

by admin ~ December 17th, 2012

Alternative energy sources have long been adopted by various developed countries over the past few decades. This in turn has helped these nations reduce annual expenditures on electricity, as well as significantly reduce pollutants released into the air from tradition power sources such as coal plants. That being said, Iraqi Dinar news reporters say that their Middle Eastern motherland may be adopting the same cleaner and greener approach first-world nations are currently integrating.

The ministry announced last month that it plans on spending $1.6 billion (roughly 1.9 trillion when converted to Iraqi Dinarcurrency) on solar and wind stations to be spread across the country. The project — which is expected to reach completion over a span of several years — will add approximately 400 megawatts of electricity to Iraq’s national grid.

The green facelift given to Iraq’s energy sector shall serve a two-fold purpose, wherein one is to deal with the issue of frequent blackouts inconveniencing locals and businesses across the nation; while the second is to bring forth improvements to environmental conditions.

A ministry official says that Iraq is an ideal candidate to adopt a solar and wind-based power system considering how there are an abundance of open deserts spread all over the entire country.

“We are confident that by entering into these agreements we will be able to provide more energy to meet the population’s needs as well as boost our interest in renewable energy as oil stocks are beginning to see shortfalls here and abroad,” said the ministry official in an interview with the media.

Observers, especially those living within the electricity-stricken country, say that plans to boost power supplies couldn’t have come at a better time. Iraq’s Dinarreporters say that ever since the 2003 American-led invasion of Iraq to oust Saddam Hussein, the nation has been struggling to keep up with the population’s demand for electricity, managing to generate a mere 8,800 MWs of the estimated 14,000 MWs required.

Laith al-Mamury, the ministry’s planning and studies department, says that Iraq has recently invited around twenty-five giant corporations to manufacture and install solar and wind projects throughout the nation.

According to Iraqi Dinar newsreports, the ministry believes that the substantial boost in alternative power sources will lead to additional energy for cheaper rates, in turn giving better shape to the energy sector’s investment nature, and ultimately stimulating its growth over the next several years.

Iraq Cutting Turkey From Energy Deal

by admin ~ December 15th, 2012

According to Iraqi Dinar news reports, Iraq awarded a drilling exploration deal to a consortium comprised of Kuwait Energy, Dragon Oil of United Arab Emirates, and Turkey’s state run TPAO. The three-member group won the contract during a public auction held from May 30 to 31, wherein they finally agreed with the $6.24 (or about 7,300 when converted into Iraqi Dinar) service fee per barrel equivalent extracted.

However, an Iraqi Oil Ministry official recently announced that TPAO was expelled from the project, which was supposed to develop within the oil-rich Basra province.

Observers speculate that the eviction of Turkey from such a significant deal is a sign of worsening ties between the two Middle Eastern countries, especially after the head of the oil ministry’s contracting and licensing department, Abdul Mehdi al-Amidi, did not pinpoint the exact reason as to why TPAO was kicked from the agreement.

“For reasons to do with non-technical issues and outside the responsibility of my office and me personally, the Turkish company TPAO was excluded from the consortium,” said Amidi in an interview with the media.

“This decision is final, there is no approval to sign the contract for Block 9,” said the oil ministry head in reference to the exploration block within Iraq’s southern region.  He then went on to explain how the verdict to remove TPAO from the conglomerate is final, and that it was a decision which originated from the cabinet.

Amidi also said that their contract stipulated the right of companies to sell their shares to others, explaining that it’d most likely be Kuwait Energy taking over TPAO’s shares, thereby increasing its stake in the consortium to 70 percent, while leaving the remaining 30 per cent to Dragon Oil.

Despite the controversial decision at hand, Turkey seems to have no problems with the cards dealt by the Iraqis. During a wind energy meeting in Instanbul, Turkey’s Energy Minister Taner Yildiz told journalists that his country shall continue with its Iraqi projects. “We meet the decision with respect,” he said in a statement to Reuters.

“We will continue supporting normalization in Iraq’s north, south, east and west. If they have any demand from us, I would like to mention once again that we will not remain deaf to that.”

According to recent Iraqi Dinar news, Iraq and Turkey signed a $350 million (over 407 billion in Iraqi Dinar) contract last November 1 for forty drills in the south. Moreover, the latter also has joint projects with Kuwait, Russia and South Korea in Iraq, and intends on pushing through with each one.

Iraqi Oil Minister’s Address to OPEC Conference

by admin ~ December 14th, 2012

The opening address to the 162nd Meeting of the OPEC Conference, by HE Abdul-Kareem Luaibi Bahedh, Minister of Oil of Iraq and President of the Conference:

Excellencies, ladies and gentlemen,

Welcome to Vienna for the 162nd Meeting of the OPEC Conference.

I should like to extend a special welcome to His Excellency Dr Abdel Bari Ali Al-Arousi, the Minister of Oil and Gas of Libya, who is attending the Conference for the first time as Head of his Country’s Delegation. Let me also thank his predecessor, His Excellency Eng Abdurahman Benyezza, for his contributions to the Conference during his time in office.

As we approach the end of the year, we are faced with a period of continuing uncertainty about the oil market outlook. To a great extent, this reflects the lack of a clear vision on the economic front. The global economy has experienced a persistent deceleration since the beginning of the year. The combination of an austerity-driven Euro-zone, the weakening recovery in Japan and clear signs of a slowdown in major emerging economies has provided the main factors behind this development. In the light of this, world oil demand growth forecasts for this year have been revised down frequently. At the same time, non-OPEC supply and OPEC natural gas liquid output have continued to perform well, outpacing demand growth. This trend is not expected to change in the coming year, with the market continuing to see high volumes of crude supply and increasing production capacity.

Turning to oil prices, while these have strengthened in the six months since the Conference last met, there have been continuing fluctuations. In June, at around the time of the Conference, prices were at their lowest daily levels for the year, with the Reference Basket price below US $100 a barrel throughout the month. It even fell below $90/b for three days. However, the Basket price then rallied strongly past $110/b in the middle of August. But after that, for most of the time since mid-September, it has been several dollars a barrel beneath this mark. This drop has reflected mounting concern about the global economic slowdown, the pessimistic future demand outlook and significant stockbuilds of crude in the United States of America. Such downward pressures have outweighed supply concern arising from geopolitical factors.

For its part, OPEC continues to do what it can to achieve and maintain a stable oil market. A key aspect of this is to ensure that the market remains well supplied with crude at all times, with fair and reasonable prices. For this to happen, there must be clear planning for the future, with sound investment strategies ensuring the necessary levels of production capacity in the years ahead. But the drawing-up of such strategies is impeded by uncertainties on both the demand and the supply fronts, as well as by high levels of price volatility. Clearly there are many doubts about the market outlook today. Without market stability – that is, sustainable market stability – all parties will suffer, producers and consumers alike.

At today’s meeting, therefore, we shall be examining the market outlook for next year and further into the future. Our focus will be on enhancing market stability in the interests of all parties, as well as in support of steady world economic growth. However, this is not the responsibility of OPEC alone. If we all wish to benefit from a more orderly oil market, then we should all be prepared to contribute to it. This includes consumers, non-OPEC producers, oil companies and investors, in the true spirit of dialogue and cooperation.

Thank you for your attention.


Iraq “The Next Big Market” For Baker Hughes?

by admin ~ December 12th, 2012

An article from Seeking Alpha speculates that Iraq could provide solid opportunities to oil field services firms likeBaker Hughes, but points out that there are significant risks and issues that need to be addressed before international firms can participate wholeheartedly in this promising market.

Baker Hughes has been making steady progress by bagging contracts in the Iraqi market. The company inked a deal with Russia’s Lukoil last year to drill in the West Qurna-2 oil fields; the firm also secured a $640 million contract for drilling 60 wells at Zubair.

However, the firms operations in the region have been slow to pick up. It has been experiencing high start-up costs relating to equipment movement and logistical issues, and the firm mentioned that at present Iraqi operations were a compression of the firms margins. A lack of clarity in rules and institutional inefficiencies have also slowed down the firms operations in the country.

The author gives a price estimate of $54 for Baker Hughes, representing a 28% premium to the current market price.


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