Iraq Promotes Liquified Gas for Vehicles

By John Lee.

The Undersecretary for Liquidation and Distribution Affairs at Iraq’s Ministry of Oil, Hamid Younis, has said that the shift towards the use of liquified gas for vehicles is a strategic project for Iraq, which promotes sustainable development and supports the national economy, and is supported by the government and the Ministry.

He added that a number of decisions and instructions have been issued that support projects for the use of liquified gas in vehicles.

He made the comments at the opening of a model workshop to install liquified gas systems in vehicles in Taji, north of Baghdad.

(Source: Ministry of Oil)

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SOMO warns Int’l Companies not to buy Oil from KRG

By John Lee.

Iraq’s State Oil Marketing Organization (SOMO) has announced that it had taken “marketing measures” and informed all international companies not to buy crude oil from the Kurdistan Region of Iraq (KRI).

SOMO Director, Alaa Al-Yasiri, also told the state-run Iraqi News Agency (INA):

“The Federal Court issued a decision stipulating the invalidity of all contracts concluded by the Kurdistan Regional Government regarding the extraction and export of crude oil.

“The regional government sells oil at lower prices than the central government, and according to news published by Reuters, the region sells oil at discounts ranging from 16-20 dollars per barrel, despite the fact that the sale takes place in the same region and with the same quality of oil.”

He added that the KRG exported around 420,000 barrels per day last year, decreasing to about 355,000 bpd this year.

(Source: INA)

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Court rules Iraqi National Oil Company (INOC) Unconstitutional

By John Lee.

Iraq’s Federal Supreme Court has invalidated the Cabinet decision to set up the Iraqi National Oil Company (INOC).

According to a statement from the Court, Paragraphs 2 and 3 of Cabinet Decision No. 109 of 2020, and Decision No. 211 of 2021, are in breach of the constitution.

The full judgement, in Arabic, can be downloaded here, with Arabic summaries here, here and here.

A summary of the judgement in English, from the Court website, is shown below:

Federal Supreme Court Rules Invalidity of Paragraphs (2) and (3) of Cabinet Decision No. (109) of 2020 and the Decision (211) of 2021 and its repeal are related to the completion of the steps of establishing the National Oil Company and the assignment of [the Minister of Oil (Ihsan Abdul-Jabbar) to head it.]

   The Court shall consider:

1-    Whereas, public funds have inviolability following all the divine laws and affirmed that the Holy Quran in a number of its noble verses and Article (27 / 1st) of the Constitution stipulates that this and that their protection is the duty of every citizen, so all institutions and employees therein must maintain the sanctity of those funds and that the initiation of a lawsuit to protect them is consistent with what is stated in Article (20 / 1st) of the Bylaw of the Court, which obliges that the interest is a state, direct and influential in the legal status or Financial or social and because it is in the interest of the people to pay the damage caused to public funds and this is considered to be in their interest.

2-    To annul the number of essential articles of the National Oil Company Law No. (4) of 2018 cannot proceed with the formation of the company.

3-    The statement that articles of other laws should be replaced by articles that have been declared unconstitutional is contrary to the binding and consistent nature of the decisions of the Federal Supreme Court, and must take into account the will and competence of the legislator to legislate other articles to replace the articles that have been declared unconstitutional, and to say otherwise means that the legislative authority is deprived of a part of its constitutional competences.

Also, the Court shall consider:

1-    The failure to find ways to preserve public funds, which belong to all the people, by the bodies legally mandated to do so is a violation of the provisions of Article (27/1st) of the Constitution, and failure to achieve this leads to the absence of social justice and the absence of national belonging to the State.

2-    The failure to maintain public funds leads to the failure of the State to carry out its constitutional duties following the provisions of Articles (29-36) of the Constitution.

It also shall consider:

1-    The Constitution of the Republic of Iraq of 2005 is the result of the will of the people following the provisions of Article (144), which stipulates that (This Constitution shall come into force after the approval of the people thereon in a general referendum) and the constitution was not drafted for the benefit of any political party, sect or nationality, but was drafted for all Iraqis without discrimination.

2-    The purpose of organizing the federal authorities and all independent bodies is to abide by the Constitution in all its articles and not to depart from it, and that this obliges all federal authorities to work for the people and that non-compliance with the Constitution represents a departure from the will of the people.

(Source: Federal Supreme Court)

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Jordan Resumes Import of Iraqi Crude

By John Lee.

Iraq has re-started the export of crude oil by road to Jordan.

Jordanian Minister of Energy and Mineral Resources, Dr. Saleh Al-Kharabsheh (pictured), announced on Monday that loading had commenced at Kirkuk, instead of the previous site at Baiji.

The memorandum of understanding (MoU), which was signed on 28th January 2021, has been extended until 31st December 2022, in order to complete the transfer of the remaining contracted quantities.

Jordan imported about 2,525 million barrels from Iraq, at a rate of 8,359 barrels per day (bpd), from September 2021 until the end of July 2022. The oil was carried by 9,678 tanker journeys from the site at Al-Siniya/Baiji to Zarqa refinery.

Pricing is based on the monthly average of Brent crude oil minus 16 dollars per barrel, in order to cover the quality difference and transportation costs.

(Source: Jordanian Ministry of Energy and Mineral Resources)

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Iraqi Oil Minister pushes Development of Eridu Oil Field

By John Lee.

Iraq’s Minister of Oil, Ihsan Abdul Jabbar Ismail, has stressed the importance of developing the Eridu (Arido) oilfield in Block 10, which is in the Muthanna and Dhi Qar provinces.

This came during a meeting with Lukoil‘s Vice President for Central Asia, Middle East, and North African affairs, Stepan Gorgi, and his accompanying delegation.

The Minister said that the ministry is awaiting the approval of the Council of Ministers of the joint development program for the field, commending the technical study of Lukoil.

He added the need to continue the development of West Qurna 2 field, and commended the cooperation between the Ministry and Lukoil to develop oil and energy sector.

The meeting was attended by the Senior Vice President of National Oil Company (INOC), Hamid Younis, the Director General of Petroleum Contracts and Licensing Directorate (PCLD), Ali Maarij. On the Russian side, the meeting was attended by Lukoil General Manager, Alexey Yakovlev, and the 10th block project manager, Edward Tcheloyansh, and vice manager of Iraq branch, manager of Lukoil reprentative office in Baghdad, Resan Sednavi.

(Source: Ministry of Oil)

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Iraq Buys New Ships for Port Maintenance

By John Lee.

Iraq’s Ministry of Oil is increasing its in-house capacity to maintain its export terminals in southern Iraq, with the acquisition of new purpose-built ships.

The Executive Director of the Iraqi National Oil Company (INOC), Hamid Younis, said that Safwan (pictured) will arrive in the coming days. It has the capability to assist with maintenance of export facilities, in addition to fighting fires and generating electric power for emergency situations. Built by the Korean company ENM, it has an integrated diving system, and is particularly suited to the maintenance of single-point moorings (SPMs).

It joins the Abu Al-Fadl, which has already entered service, and which was designed for maintenance and treatment of oil spills in regional waters.

A third vessel, the Shanasheel, is hoped to enter service in March of next year. Larger than the other two, as it will carry out major maintenance works for the ports and can accommodate staff working in ports and loading platforms.

The acquisition by the Ministry and the  of these vessels is intended to reduced the costs currently paid to foreign companies.

(Source: Ministry of Oil)

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Analysis: Ending the ExxonMobil Presence at West Qurna 1

By Ahmed Mousa Jiyad.

Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Ending ExxonMobil Presence in WQ1 Oilfield

Legal-Contractual Discussion with Economic-Financial Analysis

Information indicates that the Iraqi Ministry of Oil (MoO) proposed to acquire (buy) ExxonMobil‘s participation interest (PI) in the West Qurna 1 (WQ1) oilfield for $300 million, and that the final decision depends on the formation and approval of the new government.

The proposal revives the divergent positions that prevailed within MoO when discussing a similar situation in 2018 relating to the same oilfield.

Click here to download the full report in pdf format.

Mr Jiyad is an independent development consultant, scholar and Associate with the former Centre for Global Energy Studies (CGES), London. He was formerly a senior economist with the Iraq National Oil Company and Iraq’s Ministry of Oil, Chief Expert for the Council of Ministers, Director at the Ministry of Trade, and International Specialist with UN organizations in Uganda, Sudan and Jordan. He is now based in Norway (Email: mou-jiya(at)online.no, Skype ID: Ahmed Mousa Jiyad). Read more of Mr Jiyad’s biography here.

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Iraq’s opens its first Hydrogen Production Unit

By John Lee.

Iraq’s first hydrogen production and compression unit has been opened at the Ministry of Oil’s Oil Research and Development Centre

The unit, which is for research purposes, can produce hydrogen with a purity of 99.5 percent, and compress it to 150 bar.

A statement from the Ministry said that this is sufficient to meet the needs of the research departments, with the surplus supplies being used by companies and state institutions.

At the opening, the Ministry’s advisor for energy affairs, Abdul Baqi Khalaf, said that Iraq is committed to its commitments regarding reducing gas emissions and pollutants and protecting the environment and climate.

(Source: Ministry of Oil)

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Iraq Oil Revenue falls below $10bn in August

By John Lee.

Iraq’s Ministry of Oil has announced preliminary oil exports for August of 101,859,528 barrels, giving an average for the month of 3.286 million barrels per day (bpd), down from the 3.303 million bpd exported in July.

The exports from the oilfields in central and southern Iraq amounted to approximately 100,750,000 barrels, while exports from the Kirkuk fields through the port of Ceyhan amounted to 1,109,528 barrels.

While not explicitly stated by the Ministry, these figures seem to imply that there were no exports by road to Jordan.

Revenues for the month were $9.784 billion, falling below $10 billion for the first time since February. The average price was $96.05 per barrel.

July’s export figures can be found here.

(Source: Ministry of Oil)

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