Tuesday Afternoon Iraq Economic News Highlights 8-29-23
Tuesday Afternoon Iraq Economic News Highlights 8-29-23
He Said That The Dollar Is More Dangerous Than Weapons..
Al-Maliki: America punished Iraq with the consequences of Damascus and Tehran, and soon we will replace Iranian gas
Posted On2023-08-29 By Sotaliraq The head of the State of Law Coalition said on Monday that Iraq has been included in the US sanctions that effectively besiege Iran, Syria and Lebanon, due to the nature of money transfers to these countries, and therefore there have been restrictions on the dollar and Iranian gas supplies, stressing that this is an issue that must be addressed, although Iraq will dispense with Iranian fuel during the next two years, as he put it. LINK
After Decades Of Burning It... What Is The Possibility Of Saving Iraq's Gas Wealth?
2023-08-29 Shafaq News/ The Canadian "Natural Gas" website, which specializes in energy news, concluded that Iraq, by squandering its gas wealth over decades, now finds itself dependent on Iranian energy imports instead of being a regional energy center. However, the new project of my company " Total Energies and Qatar Energy offer some hope.
The Canadian report, translated by Shafaq News Agency, indicated that the government of Muhammad Shia al-Sudani paid Iran a long-owed debt of $2.8 billion that covers the cost of gas imports in order to operate electricity, adding that Baghdad, after obtaining an exemption from sanctions from the United States, to be able to transfer Money to Iran, the money was deposited in the Trade Bank of Iraq, and then transferred from there to the Central Bank of Iran.
Huge Gas Wealth
The report spoke of a paradox represented in the fact that these arrangements are not supposed to be necessary at all, explaining that Iraq possesses huge resources of gas in the form of associated gas, but instead of capturing this gas emitted during oil extraction, it was left to be burned.
The economic report considered that given the course of the history of oil and gas in Iraq, this country can be a regional energy center, and secure large quantities of gas to meet its electricity needs, in addition to providing gas and additional energy available to be exported to its neighbors.
However, the report expressed regret for "the misfortune of the Iraqi people", as this natural resource, which was a very vital element for achieving development during the twentieth century, was wasted, adding that even now, with the beginning of the twenty-first century, Iraqis are taking steps within the framework of efforts aimed at stopping burning Associated gas, and the search for gas resources in order to produce and develop it in economically viable ways.
Iranian Energy
The report stated that the overthrow of Saddam Hussein and the rise of the Shiite majority within the Iraqi political system led to the emergence of a new relationship with Iran, a transformation that was not smooth, but led to Iran supplying gas to Iraqi power plants to operate the electricity grid.
He also reminded that in light of Washington's tough stance against Iran, it is imperative for Baghdad to obtain periodic exemptions from the US government in order to import gas and electricity from Iran due to the US sanctions imposed on Tehran, noting that Washington lifted some of the sanctions imposed in 2015 after the agreement on The Joint Comprehensive Plan of Action related to the Iranian nuclear program, but reimposed sanctions in 2018 after Washington withdrew from the agreement.
According to the report, Iraq imports between 40 and 45 million cubic meters per day of Iranian gas, which is equivalent to about 16 billion cubic meters annually, adding that according to BP statistics for the year 2022, Iraq produced 9.4 billion cubic meters per year. 2021, but it consumed 17.1 billion cubic meters.
The report pointed out that gas resources are estimated at about 3.5 trillion cubic meters, indicating that since Iraq paid off debts to Iran, Tehran has offered to increase its gas exports to Iraq, but given that Iraq is not able to provide enough domestic gas to meet demand, this arrangement It will continue for some time now.
Decades of waste
The report quoted satellite data, that Iraq burns more than 16 billion cubic meters annually of associated gas, which is second only to Russia, and emits 30 million tons of carbon dioxide annually during this process.
In addition, the report says that stopping gas flaring would make a big difference in the Iraqi economy, adding that gas flaring was something that should have been dealt with decades ago, but through Iraq's crises, simply extracting oil from the ground and transferring it to the market was a challenge. sufficient for the energy sector in Iraq.
Repeated Promises
The report considered that the United States, which provides billions of dollars in aid annually over the past twenty years to Iraq, is frustrated about this matter and has repeatedly called on Baghdad to take the necessary measures to end its imports of Iranian energy by stopping gas flaring.
The report pointed out that Baghdad took a few steps in this context, and made repeated promises to stop flaring gas by the year 2030, adding that Baghdad says, a position that raises doubts, that more than 60% of associated gas has been acquired, and that it has developed a road map with the aim of Eliminate burning gas.
In addition, Baghdad signed the Global Methane Pledge, which was presented at the World Climate Conference in November 2021.
The report mentioned that the Iraqi Ministry of Oil concluded, in 2021, an agreement with the American company, "Baker Hughes", to implement a project aimed at capturing and treating about 200 million cubic feet per day of gas wasted by burning from the oil fields in Nasiriyah and Al-Gharf in Dhi Qar Governorate, noting that the project will be completed in The year is 2024.
In addition, Iraq is also working with the World Bank through the "Global Partnership to Reduce Gas Flaring" to stop gas flaring by 2030, adding that the Basra Gas Company has obtained financing from the World Bank to collect and process about 400 million cubic feet per day from the fields in Southern Iraq, which will reduce carbon dioxide emissions by 10 million tons annually.
Exploration Efforts
After the report referred to the efforts of Iraq, which is the second largest oil producer in the "OPEC" organization, and its sales constitute almost all of the country's foreign exchange earnings and almost all export earnings, and no less than 85% of the government budget, the report recalled that Iraq had put forward the fifth licensing round for exploration. About oil and gas in 11 areas along the borders with Iran and Kuwait, then the sixth licensing round last June, which includes 11 oil and gas fields along the Syrian and Saudi borders.
The report pointed out that the areas offered for investment may have large deposits of natural gas, and these development operations are likely to help build its own gas sector, as it is estimated that Iraq's proven reserves of conventional natural gas amount to about 3.5 trillion cubic meters, but About 70% of it is considered associated gas.
But according to some agencies, Iraq's gas reserves may in fact be much higher than that, and for this reason, any future drilling operations must be equipped to capture and process associated gas.
"GGIP"
The report considered that achieving a significant difference in the Iraqi gas sector could be achieved through the "Integrated Gas Development Project" (GGIP) signed between the Iraqi government and the French company "Total Energies" last April, in which the Basra Oil Company also participates. 30%, and Qatar Energy Company 25%, compared to 45% for the French company.
The report believed that in light of the involvement of major gas companies such as the French and Qatari companies, this is supposed to lead the project on the right track, as the French company said in a statement that the contract "represents a strong and positive signal for foreign investment in the country."
The company also said in its statement last April that the goal of the "GGIB" project is "to promote the development of natural resources in Iraq to improve the electricity supply in the country." In this context, $10 billion will be invested in the "GGIB" project. B" that spans 25 years.
The report indicated that the scope of work of the project is to recover associated gas from three oil fields in order to provide gas for power generation plants, in addition to establishing a seawater treatment plant to provide water injection to maintain pressure to increase oil production, as an alternative to using fresh water from rivers and groundwater.
In addition, the report said that "Total" companies will develop a solar energy plant with a capacity of 1 gigawatt to secure energy for the electricity grid in Basra, and that Iraq has agreed with "Total" to invite the Saudi company "Aqua Power" to join the solar energy project. LINK
Türkiye Is "Optimistic" About The Amount Of Money In The Tripartite Budget For Iraq...And Is Looking For Its Share
Economy | Baghdad today - follow-up Today, Tuesday (August 29, 2023), Turkish Minister of Trade Omar Polat said that the size of the share allocated for investments in Iraq’s approved budget for 3 years provides important opportunities for Turkish companies.
This came in his tweet, via his account on the "X" platform (formerly Twitter), commenting on his meeting with the Iraqi Minister of Construction, Housing and Public Works, Bankin Rikani, as part of his official visit to Baghdad.
He explained that he had a "productive" meeting with Rikani, who praised the success and performance of Turkish companies in the projects they have implemented to date in Iraq.
Polat indicated that, during the meeting, he expressed the desire of the Turkish business world to contribute to the development of Iraq by engaging in new projects taking place in the Arab country.
And he added, "Our companies are ready to play an active role in all infrastructure and superstructure projects in Iraq."
He continued, "The size of the share allocated for investments in Iraq's budget approved for 3 years provides important opportunities for Turkish companies."
Polat revealed that he had reached an agreement with the Iraqi minister for the latter to hold a meeting with Turkish contracting companies in the coming days, to discuss concrete projects.
The Turkish minister added that after his meeting with Rikani, a round-table meeting was held with representatives of the business world of the two neighboring countries.
In a related context, Polat said that he also met with the Iraqi Minister of Transport, Muhibis Al-Saadawi.
He added, in a tweet, that Turkey and Iraq are of major importance to the "development road project" that extends from the port of Faw in the Gulf, all the way to northern Iraq and then Turkey. LINK
Expert: Iraq Is Currently Earning At Least 50 Million Dollars A Month As A Result Of Stopping Kurdistan's Exports
TUE, 08-29-2023, TAYSEER AL-ASADI Economic expert Nabil Al-Marsoumi said that Iraq is currently earning at least $50 million per month as a result of stopping Kurdistan's exports in light of the current circumstances that oblige Iraq to reduce its oil production in compliance with OPEC Plus decisions.
Al-Marsoumi told Al-Mirbad that the amount of compulsory and optional reduction currently for Iraq within OPEC Plus = 430 thousand barrels per day, and Iraq’s current production share = 4.220 thousand barrels per day, domestic consumption of crude oil = 720 thousand barrels per day, and the planned export capacity in the 2023 budget = 3.5 million barrels per day.
He added that Iraq's exports in July 2023 = 3.440 million barrels per day, and the difference between actual exports and export capacity = 56 thousand barrels per day, and the average price of Iraqi oil sold in July 2023 = 78 dollars per barrel, and the direct financial loss incurred by Iraq in July 2023 due to the difference between Export capacity and actual exports = 136 million dollars.
He added that Kurdistan's oil exports = 400,000 barrels per day, and the difference between the price of Iraqi oil and the price of Kurdistan's oil, according to the accounts of Deloitte, which is charged with auditing Kurdistan's oil exports, = $8 per barrel (because of the quality of Kurdistan's oil, being a heavy, acidic oil and export restrictions).
He indicated that the resumption of Kurdistan's oil exports would lead to a reduction in Iraqi oil exports to the south by 400,000 barrels per day.
He pointed out that the loss of Iraq as a result of the resumption of oil exports from Kurdistan due to the price difference = 99 million dollars per month, and the transit and transportation fees = 87 million dollars per month, and the net financial loss incurred by Iraq from re-exporting Kurdistan oil = (87 99) - 136 = 50 million dollars per month,
and this loss will increase when we calculate the value of the cuts granted by Kurdistan to its oil sales to Turkey, and this means that Iraq is currently earning at least $50 million per month as a result of stopping Kurdistan’s exports in light of the current circumstances that oblige Iraq to reduce its oil production in compliance with the decisions of OPEC Plus. https://non14.net/public/159730