Iraq Economic News and Points to Ponder Monday Evening 1-13-25
British And French Companies Compete With China In Energy Projects In Iraq
Energy Economy News - Follow-up A report by the American energy news website, Oil Price, discussed the recent progress of two international Western companies to develop oil and gas fields in Iraq, indicating the return of Western companies to compete with Chinese dominance in the energy sector in Iraq, at a time when the British Petroleum Company will develop the Kirkuk oil field, while an agreement was reached with the French Total Company for an accelerated gas investment project in the Artawi field with a capacity of 50 million cubic feet per day.
The report states that China has invested huge sums in energy and construction projects in Iraq since 2013 under the Belt and Road Initiative and the Iraq-China Framework Agreement to implement projects in exchange for oil equipment and expand its activity across 34 oil and gas fields across the country that it won in licensing rounds that Western companies were absent from.
Today, BP is prominent in the scene, having agreed with the Iraqi side on December 19 on the final terms for developing the giant Kirkuk oil fields in northern Iraq, which contain an estimated 9 billion proven barrels of oil reserves. For BP, the site will complement its share in the giant Rumaila field.
The Kirkuk and Rumaila oil fields, whose production constitutes 80% of Iraq’s combined oil production, require continuous water pumping projects to maintain production. Reports indicate that the British company’s preparations for work in the field have been completed and it is expected to start the field development project by the end of this January.
The report quoted a source in the North Oil Company as saying that while the company has submitted an initial plan that includes completing the survey work and preparing the wells that have decreased in production, the agreement between the oil company and the British company to develop the Kirkuk fields will come into effect by the end of this month.
As for the French company Total, it has started work on the long-delayed $27 billion energy project in Iraq, as it has begun building a gas processing plant in Iraq in the Artawi field in Basra, which is the first phase of a huge deal for several energy projects, with the production capacity to process 50 million cubic feet per day, which is enough to supply at least 200,000 housing units in Basra.
In May of last year, the French energy company Total reached an agreement with the Iraqi government to begin work on the delayed $27 billion energy project. The company had initially signed a deal with Iraq in 2021 to build and complete four oil, gas and renewable energy projects in southern Iraq over 25 years at an initial investment rate of $10 billion.
However, this huge project has faced obstacles due to disagreements between Iraqi political parties over the terms of the deal, which led to its postponement. However, in the end, Iraq agreed to a 30% lower share in the project, which moved the deal back, opening the door to attracting foreign investment back to the country.
In recent years, Western companies such as the American company Exxon Mobil, the Dutch company Shell, and the British company British Petroleum have returned to Iraq to implement oil and gas field development projects in Iraq, which will contribute to increasing production rates after years of instability. Another factor that encouraged Western companies to come to Iraq is the relative security stability that the country is experiencing, which has doubled the chances of foreign investment to return.
Total CEO Patrick Pouyanne said in press statements, "The Iraqi government has confirmed all the terms of the agreement and there are no amendments, and this is more than good news for me."
Meanwhile, Iraq is expected to resume oil exports via the Iraq-Turkey Ceyhan pipeline to the Mediterranean coast. Oil exports through this pipeline, which amount to 450,000 barrels per day, have been halted since Turkey closed the pipeline on March 25, 2023, in response to a French international dispute settlement court ruling that Iraq be compensated $1.5 billion for oil exports without Baghdad’s knowledge. 223 views Added 01/13/2025 - https://economy-news.net/content.php?id=51892
"Al-Eqtisad News" Publishes The Full Decisions Of The Cabinet Session
Money and business Economy News – Baghdad Al-Eqtisad News publishes the full decisions of the second Cabinet session, which was held today, Monday, headed by Prime Minister Mohammed Shia Al-Sudani.
The Prime Minister's Media Office said in a statement, seen by "Al-Eqtisad News", that "Al-Sudani chaired, today, Monday, the second regular cabinet session of the current year, during which the general conditions in the country were discussed, important files and priorities of the government program were discussed, in addition to discussing the topics included on the agenda and taking the necessary decisions regarding them."
The statement added, "The Council of Ministers voted to exempt retirees from its decision No. (24888) regarding deducting (1%) of salaries to support (Gaza and Lebanon) retroactively, starting from the date of its issuance on November 24, 2024, and to recover the deducted amounts, due to the difficulty of retirees submitting requests for their unwillingness to donate, unlike employees who can submit requests through their departments, and all deducted amounts will be returned."
He explained that "within the government's measures in the environmental field, the Council of Ministers approved the recommendations of the report on treating air pollution and the spread of bad odors, which was prepared by the Ministry of Environment, as follows:
First: Immediate recommendations, including:
1. Strengthening human resources and logistical infrastructure in the environment directorates, rehabilitating air quality monitoring stations in Baghdad and the governorates, establishing the nucleus of a national center for handling, processing and linking monitoring stations and emission sources, and providing supporting portable devices.
2. Securing the necessary funding to support regulatory activities, establishing a sustainable funding mechanism to support the Ministry of Environment, and allocating part of the state’s general budget to strengthen the environmental inspection system.
3. Polluting activities provide efficient control systems for the polluting emissions resulting from them, provide environmental requirements, and adhere to applicable environmental legislation.
4. Coordination between security and environmental agencies to develop a long-term plan to ensure continued monitoring and closure of violating activities.
5. Using the best available technological solutions to improve fuel combustion efficiency in activities.
6. Participation of security agencies with technical teams to monitor irregular industrial activities that pollute the air, and take legal action against them.
Second: Medium and long-term recommendations, which included:
1. Preparing an integrated national program to address air pollution, analyze data, review legislation, estimate health impact, and calculate damage costs, with the participation of relevant parties to achieve sustainable goals.
2. Providing industrial and service activities with fuel treated with a low sulfur content within standard specifications to reduce emissions to the permissible limits.
3. Updating environmental laws and legislation to include the mandatory application of modern technologies in industrial facilities, and developing comprehensive national action plans to reduce air pollution.
4. Supporting scientific studies and research to identify pollution sources and their effects, and developing emission treatment solutions.
5. Afforestation, protection of natural areas and increasing green spaces.
6. Proper waste management, establishing regular landfill sites, encouraging waste recycling, achieving zero waste, setting strict policies, implementing alternative waste management technologies, and raising awareness of environmentally friendly practices.
He added that "the Council approved the recommendations of the minutes of the meeting of the Diwani Order Committee (23577) regarding the appointment of educational supervisors and specialists, which stipulate the appointment of specialist and educational supervisors who are graduates of the (Peace, Construction, Creativity and Challenge Course), provided that the deletion and creation are carried out by the Ministry of Finance according to the data sent by the Ministry of Education."
He pointed out that "the Ministries of Education and Finance are preparing the criteria for those accepted from among the applicants for work in educational and specialist supervision, based on separating the job grade from the job title."
In order to find a legal formula for the homes of squatters, the Council of Ministers approved the following:
1. The Mayor of Baghdad and the governors shall sell the properly divided residential lands owned by the competent municipality to the squatters who built residential buildings on them before December 10, 2024 (the date of determining the residential units by the population census committees), located within the boundaries of the basic design, as an exception to the public auction, in accordance with the Law on the Sale and Lease of State Property No. (21 of 2013) as amended.
2. The sale referred to in paragraph (1) above requires the following:
A- The land must be within the boundaries of the basic design.
B- Building from fixed structures.
C- Sale to the actual occupant of the property or his heirs whom he was legally responsible for supporting.
D - To submit an application to the Municipality Directorate within 180 working days from the date of issuance of the regulations by the Ministry of Construction and Housing.
E- The application must be accompanied by a written declaration certified by a notary public stating that the applicant, his spouse, or any of his minor children do not own a residence or a residential plot of land.
And - that the sale be for a real consideration estimated by an appraisal committee formed pursuant to Law No. 21 of 2013, as an exception to the public auction.
Z - The sale price shall be paid in accordance with the provisions of the above law.
3. It is not permissible to sell more than one piece to the applicant for ownership, and Kirkuk Governorate is not included in the provisions of this decision.
4. The committees formed in the Baghdad Municipality and the governorates, in accordance with Legislative Resolution No. (154 of 2001), shall assume legal responsibility for removing encroachments on municipal lands after the issuance of this resolution.
Within the banking reform procedures, the following was approved:
1. Establishing a new joint-stock bank that relies on the latest technologies, and aims to be a partner with companies and businessmen, whether inside or outside Iraq, and to provide financial and banking services to individuals through an integrated digital experience, and to be a leading bank at the regional level.
2. Naming the bank as the First Rafidain Bank.
3. The bank’s capital shall be (1) trillion Iraqi dinars, and the state’s contribution (government sector, public sector and individuals) shall be (24%) of the nominal capital.
4. The bank shall start with a paid-up capital of no less than (500) billion dinars.
5. Maintaining Rafidain Bank as a financial and basic gateway for implementing all government transactions, while continuing to work on its structure with Rashid Bank through a roadmap for developing Rafidain Bank in coordination with the contracted consulting company, Ernst & Young.
6. Authorizing the Central Bank to contract with a consulting company to establish the new bank, and to provide support in the various founding operations of the bank, its formations and departments.
7. The committee formed under the chairmanship of the Governor of the Central Bank, the General Managers of the Central Bank of Iraq, the General Manager of Rafidain Bank, the Undersecretary of the Ministry of Finance, and the Advisors to the Prime Minister shall coordinate with the consulting company regarding the establishment of the aforementioned bank.
8. Proceed with the plan to transform the Industrial Bank into a private joint-stock company (with a strategic partner).
9. Maintaining the status quo for the Agricultural Bank, the Real Estate Bank, and the Housing Fund.
He added that "in the electricity sector, the Council voted to approve the amendment of Cabinet Resolution (393 of 2019), confirmed by Cabinet Resolution (24210 of 2024), which includes the implementation of projects in the electricity system on lands belonging to government agencies after obtaining initial approvals from the owner and other parties, and before completing the allocation procedures or transfer of ownership of the part related to the start of project implementation, in a way that ensures compliance with the Ministry of Finance's directive dated September 12, 2024, as follows:
1- Handing over the lands owned by the Ministry of Finance for the sites of secondary station projects to the Ministry of Electricity (initial handover), and the latter ministry shall undertake the necessary procedures for the project.
2- Forming a working group to expedite the allocation procedures set forth in Paragraph (1) of Cabinet Resolution No. (24210) and registering them with the competent real estate registration departments.
The statement continued, "In order to maximize the state's revenues, the following was approved:
1. Authorizing the Minister of Construction, Housing, Municipalities and Public Works to advertise for renting spaces designated for installing billboards on public road right-of-ways located outside the boundaries of the Baghdad Municipality and municipalities and on bridges.
2. The rental mentioned in paragraph (1) above shall be for one company, a company for each governorate, or multiple companies, as required by the circumstances of the advertisement.
3. Applications are exclusively for companies registered with the Ministry of Commerce/Companies Registration Department specializing in the field of advertising.
4. Rental allowances for advertising spaces shall be estimated by the committees that must be formed in the Ministry of Construction, Housing, Municipalities and Public Works/Roads and Bridges Department, pursuant to the Sale and Lease of State Property Law No. (21) of 2013 (as amended).
He explained that "in order to meet the needs of displaced and returning families and to ease their burden, the Council of Ministers agreed to the Ministry of Migration and Displacement continue to work in accordance with paragraph (1) of Cabinet Resolution (24007 of 2024), which includes the inclusion of these categories in the programs of subsidy salaries, social protection, full-time assistants, and soft loans."
He pointed out that "in the field of energy, the Council of Ministers approved the Iraqi Drilling Company's contract with the companies (EBS and Kosel), the subcontractor of the Iraqi Drilling Company, according to new contractual terms as an exception to the contracting methods stipulated in the instructions for implementing government contracts (2 of 2014) to implement the contract for the project to drill (18) wells."
As part of the government’s measures to complete stalled and suspended projects, the Council of Ministers approved the following:
1. Deleting the non-referred components that did not include the estimated cost amounts stated in the Ministry of Planning’s letter dated December 30, 2024.
2. Deleting the completed components that are not included in Cabinet Resolution No. (301 of 2021) stated in the Ministry of Planning letter referred to in the above paragraph, based on the cumulative expenditure.
3. Deleting the components referred to investment or that have been delivered to the beneficiary and that are not included in Resolution (301 of 2021), based on the cumulative expense.
4. Establish (4) complementary business components shown in the attached table, linking the Ministry of Planning’s letter dated December 30, 2024.
5. Reducing the total cost of the project (establishing 20 model youth and women’s forums in the districts and sub-districts of Baghdad Governorate and the governorates) in the investment budget tables of the Ministry of Youth and Sports for the year 2024, and changing the name of the project to (establishing model youth and women’s forums in the districts and sub-districts of Baghdad Governorate and the governorates, number 14) instead of establishing model youth and women’s forums in the districts and sub-districts of Baghdad Governorate and the governorates, number 20).
The Council of Ministers approved the exemption of the projects (Rehabilitation of the main Dora sewage pumping station) and (Rehabilitation of (22) pumping stations on the Rusafa side) from Cabinet Resolution (24217 of 2024) and their continued financing from the World Bank loan, while ensuring the World Bank’s commitment to financing and emphasizing the Baghdad Municipality to complete the two projects urgently, according to a statement from the media office.
The following was also approved:
1. Financing the Ministry of Finance with an amount equivalent to (390) thousand US dollars, the Republic of Iraq’s contribution to the Arab Labor Organization in the amount of the financial appropriation, based on the provisions of the Federal General Budget Law (13 of 2023).
2. Appointing employees in administrative positions in line with the amount of the Republic of Iraq’s contribution, which amounts to (10%) of the countries’ contributions within the budget approved by the Arab Labor Organization.
The statement highlighted that "the Council voted on the draft law on the Republic of Iraq's accession to the Arab States in Asia Cooperative Agreement for Research, Development and Training in the Field of Nuclear Science and Technology for the year 2017 (ARASIA), which entered into force on July 28, 2020, and referred it to the Council of Representatives, based on the provisions of the Constitution." 114 views 01/13/2025 - https://economy-news.net/content.php?id=51911
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