Major international oil companies are bracing for a non-calculated gamble in Iraq
Wednesday, 01 July 2009 10:11
Baghdad \ Iraqi files
Welcomed Iraq's major oil companies worldwide, as the Iraqi government intends to offer the contracts for the exploitation of large oil fields in the auction to foreign companies for the first time since Iraq nationalized its oil industry for more than three decades.
If all goes according to plan in the first round of the foreign oil companies will go to assist Iraq in the rehabilitation of production processes in the six fields have suffered over the years of war and neglect. However, the political division in Iraq is the complexity of the process, as called for by some members of parliament and officials in the oil sector to the postponement of the auction.
Was attended by the man who stands behind these plans, which Iraqi Oil Minister Hussain al-Shahristani, the parliamentary session held on Tuesday, where a number of parliamentarians crossing checks on the legal contracts, and they proposed that the preferential terms obtained by foreign companies.
However, the implementation plans for the auction is sufficient political support, which guarantees his stay on schedule as promised al-Shahristani and other government officials to move forward in its implementation.
It should be noted that the oil contracts, which were announced by al-Shahristani, are of paramount importance to the economy of war-torn Iraq. It is believed that Iraq had one of the largest supply of crude oil reserve in the world, certainly up to 115 billion barrels.
However, foreign expertise is still needed in Iraq's plans to support the daily production of oil to up to four million barrels per day during the four or five years ahead, note that the current production is estimated at 2.4 million barrels a day.
Despite the security risks, the Western oil companies are racing to enter Iraq and win those contracts, due to the fact that many of the oil regions in Iraq have not yet discovered, which gives large corporations the opportunity to achieve significant growth. Also finds some in Iraq an opportunity to discover the most important oil fields for the first time since the disclosure of the giant Kashagan oilfield in the Caspian Sea in 2000.
According to the Iraqi Oil Ministry, there are about 120 companies expressed a desire to progress to enter the
auction to be held on 29 and July 30 under to win oil contracts, including 35 companies qualified to bid, including Exxon Mobil and Royal Deutsche Shell and Italy's Eni and Russia's Lukoil and Sinopec Chinese.It should be noted that the six oil fields that will be auctioned to contain reserves of up to more than 43 billion barrels. Foreigners will not get the most valuable piece of the auction - the ownership share in the reserves - but they will receive a fee increase production.
There are no more than 20 oil fields from the fields of Iraq's 80 known fields that have only been developed in whole or in part, and most of Iraq's oil production comes from three major fields, namely, North and South Rumaila and Kirkuk.
Owing to the presence of large quantities of black gold, which facilitates the extraction is estimated by various experts in the affairs of the oil exploration and development in Iraq will cost an amount ranging from 1.50 to 2.25 dollars per barrel, compared with up to 5 dollars in Malaysia and U.S. $ 20 in Canada.
In this context, says analyst Samuel Sizok Department of Energy in the Middle East of any institution. HTML. S Global Insight's analysis and financial projections, "We are talking about huge quantities of crude oil that flows through their system to the companies that win contracts. On the other hand, Iraq urgent needs of the technology and those companies that can bring. "
Despite all those benefits, the architect of that plan, which al-Shahristani, oil minister came under attack from many sides in Iraq, with the decline in oil prices and a crisis in the budget were to blame for the failure to increase production as sufficient to make a difference.
On the other hand, say lawmakers and officials in the oil sector, this will give the auction a great opportunity for foreign access to Iraq's resources and, therefore, been made to the interrogation of Mr. al-Shahristani, the Iraqi parliament on charges of corruption and mismanagement in his ministry.
The MP said Jaber Khalifa Jaber Al-Rapporteur of the Commission on oil and gas affecting the Iraqi parliament "should not continue to be al-Shahristani. The opportunity to let the other person is qualified to do this .. I can not recall a single achievement."
For his part, the spokesman for Iraqi Prime Minister Nuri al-Maliki - during his appearance earlier this month with al-Shahristani - full confidence in the Minister of Oil, stressing once again that the auction will take place as scheduled.
During a recent dialogue with al-Shahristani, a 66-year-old said he had not done anything wrong and that criticism in the Parliament House linked to a political agenda, he said, adding that he looked forward to respond to the inquiries concerning the parliamentary corruption and mismanagement.
He said in his "I hate politics and the only reason for me to continue my responsibilities is to protect the wealth of the Iraqi hands dirty."
Usually be reached in Iraq during the conventions dealing with cups of tea in the evening, but does not like Mr. al-Shahristani, the informal negotiations and unfair to the extent that the refusal to grant many of the functions desired to old friends.
Shahristani has earned a reputation as a great adherence to the rules and system, including the procurement of complex systems, which deliver many of the other oil officials blame the slow development of Iraqi oil. As al-Shahristani has previously said that the refusal of even small gifts such as ties of executives visitors.
During his three years in office as minister of oil, Mr. al-Shahristani, a strong ally of Maliki as the start of the decline of violence in 2008, the Maliki and al-Shahristani, and a number of other Iraqis who lived in exile, to pay a series of ambitious economic reforms.
It should be noted that the expulsion of Western oil companies out of Iraq in 1972 as part of a wave of nationalization of the oil industry in the Middle East. Oil production in Iraq, up to at least three million barrels of oil a day before the Iraqi invasion of Kuwait in 1990, which collapsed dramatically to reach 300 thousand barrels after the economic and trade sanctions imposed on Iraq. Returned to the increase production to around 2.5 million bpd before the U.S. invasion in 2003.
House debate over the years between Iraqi lawmakers on the draft Iraqi oil law aims to establish a legal framework for foreign companies to begin drilling operations in again. After that Mr. al-Shahristani did not wait long in the hope of the issuance of this law was made in 2008 to invite a single oil companies bidding for contracts.
Because the companies were reluctant to discover undeveloped oil fields in Iraq without the oil law-Shahristani has focused on access to foreign assistance for extraction of oil from existing fields already.
In this context, he "has done what we can to our national resources and we are now in need of outside help."
Although al-Shahristani said that the contracts were not required to obtain the consent of the parliament, it insists that they meet the conditions set by the draft oil law, which should be formulated in the Council of Ministers today. He added that some of these conditions are particularly useful in Iraq, such as the stipulation that the winner of the auction, he will have to give the government hundreds of millions of dollars in cash.
Mr. Shahristani was born in Karbala for a religious family, a nuclear scientist to study, he studied in Moscow and spent some time in London where he obtained a master's degree and doctorate in nuclear chemistry from the University of Toronto, and in 1978 became a senior adviser to the Iraqi Atomic Energy Commission.
As the saying and the other al-Shahristani, after Saddam Hussein became president of Iraq, he wants a nuclear weapon. He adds that during the al-Shahristani to meet face to face with Saddam Hussein said that Iraq is a signatory to the Nuclear Non-Proliferation Treaty and committed, but Saddam Hussein responded by saying that it should focus on science and leave policy to him.
After the incident several days in December 1979 he was arrested and took him to al-Shahristani, to the prison officials of the Internal Security Forces of Iraq, where he was tortured for three weeks.
Shahristani says the torturers offered him wealth and inadequate re-thinking whether to refuse to work on nuclear weapons, and when he refused he was thrown in solitary confinement where he remained for 10 years. He says, "have not lost my sense of determination to not ever lose my faith."
After the air strikes by the U.S. troops to Iraq in the first Gulf War, al-Shahristani, was able to escape and infiltration across the border with Iran, which continued during the following years helped the refugees and the Iraqi opposition. After the U.S. troops entered Iraq in April 2003 he returned to his country. U.S. officials believe that the strongest candidate for the post of Iraqi prime minister, but he refused the job because it does not get elected, and preferred to be the Vice-President of the Iraqi parliament.
After the formation of the new Iraqi government of Prime Minister Nuri al-Maliki, al-Shahristani, in 2006 became minister of oil, during the next two years were killed and the abduction of hundreds of staff of the ministry, the separation of al-Shahristani, has 250 security personnel in the ministry who were considered to be members of armed groups and replaced them with officials of the security he trusted them. In the same context, the submission of evidence of many abuses in the ministry to the Inspector General, and the separation or transfer of those suspected of illegal acts.
But al-Shahristani, the problems encountered in the development of Iraq's oil production, where militants had attacked oil pipelines and refineries, and the foreign companies were reluctant to enter Iraq because of the lack of a legal framework for this.
The delay and the Iraqi government in the development of the oil industry in the payment of the territory of the semi-autonomous northern Kurdistan to move unilaterally, as officials in the region occurred in the September 2007 agreement with U.S. company Hunt Oil, al-Shahristani, has criticized the deal, saying it was not based on any basis legal, but the Government of Kurdistan, accused him of moving too slowly and continued to work on the agreement.
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