Iraq

Chevron drills oil well in Iraqi Kurdish area after two-year gap: sources

21 Sep 2017   Iraq, USA

U.S. firm Chevron drilled its first exploration well this month in Iraqi Kurdistan after a two-year break, industry sources said, signaling its confidence in the area despite an international row over region’s independence referendum plan. Chevron, the second-largest U.S. oil and gas company, drilled the well in Sarta block, north of the regional capital Erbil, the first such well since the second half of 2015, two industry sources told Reuters. “Chevron continues its exploration activities in the Kurdistan Region of Iraq,” a Chevron spokeswoman said, without elaborating. Chevron holds an 80 percent interest in the Sarta and Qara Dagh blocks, which cover a combined area of 279,000 acres (1,129 sq km), according to its 2016 annual report. It does not currently have any production […]

Russia becomes Iraq Kurds’ top funder, quiet about independence vote

21 Sep 2017   Iraq, Russia

Russia, the only major power that has not called on Iraq’s Kurds to cancel a referendum on independence next week, has swiftly become the top funder of Kurdish oil and gas deals, with as much as $4 billion pledged in less than a year, industry sources say. Washington, European countries, Turkey and Iran have all lined up to oppose a move by Iraq’s Kurds to hold a Sept. 25 independence referendum, which the Kurds consider the culmination of decades of struggle for a state of their own, but Iraq calls a violation of its constitution. This week, the White House issued a statement calling the planned vote “provocative and destabilizing”, noting that it will take place not only within the autonomous Kurdish region itself but on territory that is disputed. But Moscow has issued no such call to cancel the vote. Instead, with the planned referendum […]

Russia’s Kurdish Pipeline Gamble

21 Sep 2017   Iraq, Russia

Rarely does one see such a multi-faceted move as Rosneft declaring it will build a $1 billion pipeline bringing gas from Iraqi Kurdistan to Turkey. The 30 BCm/year pipeline would not only allow the ever-expanding Rosneft to fortify its position in Kurdistan and nip into the Turkish gas market, but it could also challenge the export monopolist Gazprom, as the heavy lobbying effort to liberalize access to gas exports failed on the domestic market, it seems it might work out in Turkey. Rosneft-Kurdistan relations intensify by the minute. In February, the sides concluded an oil supply agreement. In July they signed a framework agreement. And in mid-September they formalized their commitment to build the Kurdistan-Turkey gas pipeline. The deal creates a win-win situation for both Rosneft and the KRG government, yet is fraught with serious geopolitical consequences in a region where war remains the prevailing theme of the 21 […]

New offensive aims to retake western Anbar

21 Sep 2017   Iraq

Iraqi security forces are launching an offensive to dislodge the self-proclaimed Islamic State (IS) from the western part of Anbar province – the largest remaining swath of Iraqi territory controlled by the militant group, which includes the Akkas gas field. In parallel actions this week, Iraqi troops swept up along the Syrian border to retake the town of Akashat, partially sealing off a western flank. Then, forces began advancing from the east toward the IS-occupied district of Ana.

Could Kurdish Independence Spark An Oil War?

20 Sep 2017   Iraq

As the date of the Kurdish independence referendum approaches, oil industry moguls should be concerned about an oil production war between Iran and headless Iraq. The Kurds are expected to vote on their political status in late September. A vote in the affirmative would mean that Iraq would lose a chunk of its northern areas, which includes the crucial Kirkuk oilfield and its surrounding reserves. The latest news from the election committee shows that the Kurdistan Regional Government (KRG) is doing the most it can to increase international participation in the election. On Monday, authorities announced that they had removed a key requirement for diaspora voters participating in the elections. Kurds participating in the e-voting platform will no longer be required to present a ration card to be able to cast their vote through September 25 th . Iraqis who have been living abroad for several years, even decades, […]

More Kurdish oil possible, Gulf Keystone says

20 Sep 2017   Iraq

There’s enough cash flow to invest in efforts needed to increase the level of crude oil production from the Kurdish north of Iraq, Gulf Keystone Petroleum said. Gulf Keystone, which has headquarters in London, but a portfolio based in northern Iraq, in August reported total average gross production from its Shaikan oil field last year was at the upper range of its guidance. In an update on operations for the first six months of this year, CEO Jón Ferrier said work so far was in line with expectations, with gains likely in the latter half of the year. “Whilst continuing to maintain a rigorous and disciplined approach to its cost base, Gulf Keystone remains […]

Russia’s Rosneft to fast-track gas export option in Kurdish Iraq

19 Sep 2017   Iraq, Russia

Russian energy company Rosneft says it’s put a gas export pipeline from the Kurdish north of Iraq on the fast track toward development. Photo courtesy of Rosneft. Sept. 18 (UPI) — Cooperation on pipeline infrastructure in the Kurdish region of Iraq could set the stage for gas exports to Europe, Russian energy company Rosneft said. Rosneft said it was finished with the due diligence requirements for an oil export pipeline from the Kurdish north and is in the process of finalizing the necessary legal documents. Total Kurdish oil production isn’t as robust as oil fields elsewhere in the country, though the semiautonomous Kurdistan Regional Government aims to increase its potential through exports by truck and through pipelines to the Ceyhan port in Turkey. Rosneft said Monday it was now ready to consider working with the KRG on new gas pipeline infrastructure and agreements on development could materialize by the […]

Iraq’s Supreme Court Tells Kurds to Suspend Independence Referendum

19 Sep 2017   Iraq

Iraqi Kurds fly Kurdish flags during a recent event to urge people to vote in the upcoming independence referendum in Arbil, the capital of the autonomous Kurdish region of northern Iraq. Iraq’s Supreme Court ruled Monday that the semiautonomous Kurdish region should suspend an independence referendum scheduled for next week, though the Kurds have so far ignored the court’s decision and other last-ditch efforts to stop them from carving out a new country in Iraq. Monday’s decision marks the latest opposition—both local and international—to the vote. Kurdish officials say a door is still open to postponing the referendum, which some observers see as a powerful lever to extract more aid from the West, if they are given certain unspecified concessions by the central government and Western nations. “Because the requests fulfill the legal conditions, the court has issued a ‘temporary halt decision,’” the high court said. The order came […]

The Kurdish Referendum Could Reshape Oil Markets

19 Sep 2017   Iraq

Iraq, the second-largest OPEC producer, may be facing a significant disruption to its oil exports this month. On September 25, citizens of the northern region of Kurdistan, a semi-autonomous area of Iraq, will vote in a referendum for national independence . If the referendum passes, as it is expected to, Kurdistan could begin proceedings to proclaim formal independence from Iraq, splitting the country in two. On Monday, the Iraqi prime minister Haider Al-Abadi called on the vote to be suspended until after the war against the Islamic State (IS) is concluded. Oil is at the center of it all. Kurdistan itself is rich in oil , possessing reserves equal to 45 billion barrels, and could potentially become a larger producer than Nigeria. According to figures from the KRG, Kurdistan currently exports about 600,000 barrels a day, though that number is difficult to account for. Other reports indicated it exports […]

Iraq oil minister says does not see need for more output cuts now

19 Sep 2017   Iraq

Iraq does not see the need for more output cuts now, but if there is a need the country will support consensus within the Organization of the Petroleum Exporting Countries (OPEC), Iraq’s oil minister Jabar al-Luaibi said on Tuesday, Iraq’s oil supply cuts are around 260,000 barrels per day, exceeding its share of planned reduction, al-Luaibi told Reuters on the sidelines of an energy conference in the United Arab Emirates. He said also said prices in the range of $55 to $60 barrels a day are better for everyone. OPEC and other producers, including Russia, have agreed to reduce output by about 1.8 million barrels per day until March 2018 in a bid to reduce global oil inventories and support oil prices.

Kurdistan gets Russian vote of confidence

19 Sep 2017   Iraq

Besieged by international pressure to delay its independence referendum, the KRG gets geopolitical backup from a Rosneft agreement to underwrite oil and gas export pipelines. Massoud Barzani, the president of Iraqi Kurdistan, lands in Moscow in February 2013. (Photo credit: Kurdistan Presidency office) The state-controlled Russian oil company Rosneft is advancing and expanding its multi-faceted energy deal with the Kurdistan Regional Government (KRG) – giving the KRG a badly needed geopolitical boost ahead of its controversial independence referendum. Rosneft is moving forward with plans to invest in Kurdistan’s crude oil pipeline to Turkey, and it has announced a new intention to finance a gas export pipeline, according to statements released Monday by Rosneft and the KRG Ministry of Natural Resources (MNR), as well as industry officials. This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or […]

Russia’s Rosneft clinches gas pipeline deal with Iraq’s Kurdistan

18 Sep 2017   Iraq, Russia

Russian oil major Rosneft ( ROSN.MM ) will invest in gas pipelines in Iraq’s Kurdistan, expanding its commitment to the region ahead of its independence vote to help it become a major exporter of gas to Turkey and Europe. Kurdistan has been exporting oil independently from the central government in Baghdad since 2014 and Kremlin-controlled Rosneft joined the list of buyers this year, lending the semi-autonomous region hundreds of millions of dollars in loans guaranteed by future oil sales. Now Rosneft is widening its investments to gas by agreeing to fund a natural gas pipeline in Kurdistan, Rosneft and the Kurdistan Regional Government (KRG) said on Monday. Two sources close […]

Islamic State Claims It Carried Out Deadly Attack in Southern Iraq

15 Sep 2017   Iraq

Iraqi security forces inspect the site of a bomb attack at a police checkpoint on a highway near the southern Iraqi city of Nassiriya on Sept. 14. BAGHDAD—Islamic State gunmen stormed a restaurant in southern Iraq after blowing up a car bomb outside, killing more than 50 people, Iraqi officials said, including Iranian pilgrims having a meal. Thursday’s attack, along a highway near the southern city of Nassiriya, was one of the deadliest in the country in recent months and comes as Islamic State’s days of ruling over vast areas of Iraq near an end. The Sunni Muslim extremist group claimed the assault in a statement, saying three groups of fighters clad with explosive belts had killed dozens of “rejectionist idolaters”— slurs it uses to denote Shiite Muslims. An interior ministry official said a bomb had first exploded in the restaurant parking area. Gunmen disguised as members of Iraq’s […]

Shell accelerates Iraq drawdown with Majnoon exit

15 Sep 2017   Iraq

Negotiations begin over handing back the Majnoon operatorship, months after stake in West Qurna 1 was put up for sale, highlighting one major oil company’s resistance to Iraq’s tough terms. The Majnoon contract being initialed by Shell Vice President Mounir Bouaziz on Dec. 20, 2009. (BEN LANDO/Iraq Oil Report) NEW YORK/BASRA – Royal Dutch Shell is further reducing its exposure to the Iraqi oil sector, announcing Wednesday that the company has reached an initial deal with Iraq’s Oil Ministry to leave the nearly eight-year-old Majnoon oil field project. Shell is also in the process of selling its 20 percent stake in the ExxonMobil-operated West Qurna 1 field, part of the company’s global effort to leave projects that have lower upsides. This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free trial […]

Shell set to draw line under a century of Iraqi oil

14 Sep 2017   Iraq

Royal Dutch Shell ( RDSa.L ) is set to end a century of oil production in Iraq by withdrawing from two of the Arab state’s flagship fields to focus on more profitable gas development. Shell’s retreat highlights the challenges foreign operators face with low-margin oil contracts in Iraq, an OPEC member that sits on some of the world’s biggest oil reserves and wants to boost production after years of conflict hindered development. The Anglo-Dutch firm said on Wednesday it had agreed with Iraq’s oil ministry to relinquish operations at Majnoon field to the government after unfavorable changes to fiscal terms. The announcement confirmed an earlier Reuters report. Shell is also selling its 20 percent stake in […]

OPEC’s No. 2 Faces Civil War Threat

14 Sep 2017   Iraq

A majority of Iraq’s law enforcement network has congregated in the northern and western portions of the country to contain the efforts of the Islamic State to restart the reign of its illicit organization, giving Shia and Sunni the leeway to reignite previous rivalries. “We need larger forces to control rural areas and restrain lawless tribes in the south,” Army Lieutenant Colonel Salah Kareem said. “This is a difficult job for now as most troops are busy with fighting [IS].” The religious disputes turn legal as members quarrel over farmland, construction contracts, and other land ownership issues, security courses said. The net impact of the disagreements disrupts Baghdad’s efforts to bring new investments to the oil and gas sector in areas affected by three years of domestic strife. Stable oil output from Basra is key to Baghdad’s wealth, which accounts for 95 percent of the government’s revenues. […]

Shell accelerates Iraq drawdown with Majnoon exit

14 Sep 2017   Iraq

Negotiations begin over handing back the Majnoon operatorship, months after stake in West Qurna 1 was put up for sale, highlighting one major oil company’s resistance to Iraq’s tough terms. The Majnoon contract being initialed by Shell Vice President Mounir Bouaziz on Dec. 20, 2009. (BEN LANDO/Iraq Oil Report) NEW YORK/BASRA – Royal Dutch Shell is further reducing its exposure to the Iraqi oil sector, announcing Wednesday that the company has reached an initial deal with Iraq’s Oil Ministry to leave the nearly eight-year-old Majnoon oil field project. Shell is also in the process of selling its 20 percent stake in the ExxonMobil-operated West Qurna 1 field, part of the company’s global effort to leave projects that have lower upsides. This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free trial […]

Shell to withdraw from Iraq’s Majnoon oilfield – Iraqi oil officials

13 Sep 2017   Iraq

A worker walks through the Majnoon oilfield in Basra, 420 km (261 miles) southeast of Baghdad, October 6, 2013. REUTERS/Essam Al-Sudani BAGHDAD (Reuters) – Royal Dutch Shell is seeking to sell Iraq’s Majnoon oilfield and the oil ministry has started preparations to finalize its exit, according to an oil ministry letter and oil officials. A letter signed by Iraqi oil minister Jabar al-Luaibi and dated Aug. 23 and directed to Shell Iraq Petroleum Development gave approval for Shell to quit Majnoon, an oilfield near Basrah which started production in 2014. “We respect your desire and decision to seek an acceptable end of Shell Iraq Petroleum Development SIPD’s interest in Majnoon,” the oil ministry letter said, a copy of which was seen by Reuters. SIPD is Shell’s local unit. Three Iraqi oil officials and an Iraqi senior engineer working with Shell in Majnoon confirmed the letter’s authenticity. A Shell spokesman […]

Alamri out as head of Iraq’s oil sales

12 Sep 2017   Iraq

Iraq’s longtime head of oil sales, Falah Alamri, has been transitioned from director general of the State Oil Marketing Organization (SOMO) to advisor to the Oil Ministry. Alaa al-Yassiri, acting director general of the economic and investment directorate at the ministry since February and a former deputy director general in charge of finance at SOMO, has been named as acting chief of SOMO, according to two ministerial orders issued Sunday by Oil Minister Jabbar al-Luiebi.

View full article at www.iraqoilreport.com

Hawija offensive hamstrung by Baghdad-Erbil mistrust

12 Sep 2017   Iraq

Political tensions arising from Kurdistan’s upcoming independence referendum are complicating an impending offensive to dislodge the self-proclaimed Islamic State (IS) militant group from one of its last strongholds in Iraq. Kurdish leaders have grown alarmed in recent weeks as federal Iraqi troops have deployed for an attack on Hawija, which is west of Kirkuk – and near large oil fields at the heart of long-standing disagreements over how to draw Kurdistan’s southern border.

Russia’s Big Bet On Kurdish Oil

11 Sep 2017   Iraq, Russia

In June 2017, Kurdistan Regional Government (KRG) and Russian energy behemoth Rosneft signed several cooperation, investment and production sharing agreements regarding hydrocarbon exploration, production, infrastructure, logistics and trading. Rosneft also obtained access to Kurdistan’s oil pipeline to Turkey with a capacity of 700,000 bbl/day, and is planning to extend this to over 1 million bbl/day, although no timeline has been given. Earlier in 2017, Rosneft’s Swiss-based trading arm Rosneft Trading S.A. agreed to buy crude oil from Iraqi Kurdistan until 2019. The crude is to be delivered to Rosneft’s refineries in Germany. Rosneft committed to paying KRG for oil supplies in advance. According to sources quoted by Bloomberg , the first advance payment was U.S. $1 billion. The deal meets the commercial interests of both sides. Rosneft expanded its global portfolio and secured crude supplies for its German, and potentially new Indian, refineries. In August 2017, Rosneft finalised the […]

For Iraq’s Long-Suffering Kurds, Independence Beckons

9 Sep 2017   Iraq

Men bought and sold prayer beads last month in front of the citadel in Erbil, a Unesco World Heritage site, in the Iraqi Kurdistan region. BARZAN, Iraq — A pair of rusted eyeglasses, a grimy antique watch, torn bank notes and old identification cards. These simple items on display at a museum here in northern Iraq, dug from a mass grave of Kurdish tribesmen massacred by Saddam Hussein’s henchmen, help explain why there is little doubt about how Kurds will vote in a referendum this month on independence from Iraq. “How could the international community expect us to be part of Iraq after these crimes?” said Khalat Barzani, who is in charge of the museum that memorializes the deportation and killings of thousands of Kurds in 1983. Unmarked grave stones dot the hillside near the town of Barzan, Iraq, at a commemorative cemetery for members of the Barzani clan […]

DNO takes Exxon operatorship

8 Sep 2017   Iraq

Norway’s DNO is teaming up with ExxonMobil and a state-backed Turkish company in Ninewa province’s Bashiqa block, under contract by Iraq’s autonomous Kurdistan region. “DNO will assume operatorship of the license with a 40 percent paying (32 percent net) interest, acquiring one-half of ExxonMobil’s position,” DNO said in a statement released early Friday from Oslo. “ExxonMobil retains a 40 percent paying (32 percent net) interest, the Turkish Energy Company (TEC) its 20 percent paying (16 percent net) interest and the Kurdistan Regional Government its 20 percent carried interest.” This […]

Oil revenues up, but August exports dip

6 Sep 2017   Iraq

Iraq is averaging higher-than-expected oil prices so far this year, but is struggling to maintain export volumes as a result of OPEC cuts and disputes with Kurdistan. A worker from Iraq’s State Company for Oil Projects welds the pipeline connecting the Zubair-1 and Zubair-2 oil depots to the Fao depot, providing more flexibility for both exports and feeding the Shuaiba refinery. (Source: Basra Oil Company) Oil exports by Iraq’s federal government dropped slightly over the past month, but revenues increased from $4.386 billion to $4.608 billion on the back of rising oil prices. Crude shipments decreased month on month from 3.23 million barrels per day (bpd) in July to 3.216 million bpd in August.* This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free trial .

Has Iraq Stopped Cheating On The OPEC Deal?

1 Sep 2017   Iraq

OPEC’s no.2 Iraq is currently producing 4.32 million bpd of oil, below the 4.351 million bpd ceiling it had pledged in the production cut deal, Iraq’s Oil Minister Jabbar Al-Luaibi said on Friday, in what is the first sign that one of the worst-compliant producers so far may have finally started to stick to its commitment—a couple of months after the original agreement was set to expire. Despite Iraq’s optimism, its central government doesn’t yet have the full picture of the oil exports of the Kurdistan Regional Government, Al-Luaibi said after meeting with Russia’s Energy Minister Alexander Novak in Moscow. Iraq’s oil exports are up to 3.23 million bpd , Al-Luaibi told reporters, adding that Kurdish crude exports are at between 300,000 bpd and 350,000 bpd. According to data on tanker traffic compiled by Bloomberg, total exports from Kurdistan—including production of some fields in the region that are governed […]

Iraq cutting more oil production than necessary

1 Sep 2017   Iraq

Iraq is doing more than it needs to in terms of working to balance an oversupplied market through an OPEC-led effort, its oil minister said Friday from Moscow. Russian Energy Minister Alexander Novak hosted Iraqi Oil Minister Jabbar al-Luaibi at the Kremlin to discuss what Novak’s ministry said Thursday were “urgent issues” of cooperation between members of the Organization of Petroleum Exporting Countries and non-member states. Russia is contributing most to a multilateral effort to sideline about 1.8 million barrels of oil per day among non-OPEC members. The OPEC effort is aimed at bringing the level of global crude oil inventories closer to the five-year average. Total supplies for members of the Organization for Economic Cooperation and […]

Iraq’s Solution To Lower For Longer Oil Prices

1 Sep 2017   Iraq

OPEC’s second-largest oil producer, Iraq, has never hidden the fact that it wants to get the highest possible revenues from its oil. It even pleaded exemption from the cartel’s cuts in the talks leading to the production reduction deal, on the grounds that it needed more funds to fight ISIS. Iraq didn’t get that exemption, but it is now considering a change in the way it prices its oil exports to the most prized market for the Middle Eastern producers—Asia—in an effort to increase its oil revenues. Iraq’s state marketing company SOMO is seeking feedback from customers by August 31 on a plan to change the Basra crude pricing for Asia to the Dubai Mercantile Exchange (DME) Oman futures beginning next year, dropping the average of Oman and Dubai quotes by S&P Global Platts. Iraq’s idea is seen as a breakaway move from the leading Middle Eastern exporter, Saudi […]

KRG deal settles debts, gives more acreage to Pearl

31 Aug 2017   Iraq

By settling with Dana Gas and partners, the Kurdistan region avoids tens of billions of dollars of potential liability and commissions massive new gas production within two years. A flare is seen behind a sign at the Khor Mor LPG plant in Iraqi Kurdistan on May 27, 2013. (JACOB RUSSELL/Metrography/Iraq Oil Report) Iraq’s autonomous Kurdistan region has settled a massive, long-standing dispute with one of the earliest and most important investors in its gas sector. The agreement, announced Wednesday, enables the Kurdistan Regional Government (KRG) to move forward with developing badly needed gas production and power generation capacity, and to resolve a contentious episode that tarnished its investor-friendly image. This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free trial .

Platts plans assessments for Iraqi Basrah Light and Basrah Heavy crude

31 Aug 2017   Iraq

Oil price agency S&P Global Platts is proposing to start price assessments for Iraqi Basrah Light and Basrah Heavy crude oil cargoes on a free-on-board (FOB) Basrah basis from Nov. 1, the company said in a subscriber note on Thursday. These new assessments will be added to its existing prices for Basrah Light on a delivered U.S. Gulf Coast basis, the company, a unit of S&P Global Inc, said. They will be for cargo sizes of 1 million barrels each for both grades. “Platts’ new assessments would reflect crude traded on a destination-free basis,” the company said in the note. For each grade, Platts will publish a differential to its official selling price for the month of loading as well as an outright price. The planned launch of the two price assessments follows talks with industry participants amid an “evolution in the quality and markets for […]

Iraq Braves Break With Tradition to Get Oil’s True Worth

30 Aug 2017   Iraq, Prices

OPEC’s second-largest producer is stepping up the campaign to get more for its oil by looking to revamp the way it sells crude to its biggest customers. (Bloomberg) — OPEC’s second-largest producer is stepping up the campaign to get more for its oil by looking to revamp the way it sells crude to its biggest customers. Iraq is considering plans to use a new reference price for sales to Asia, according to traders, who received a notice from the state oil company SOMO. The producer is proposing to use a contract traded on the Dubai Mercantile Exchange as a benchmark for pricing Basrah crude, replacing the formula it currently uses along with competitors such as Saudi Arabia, Kuwait and Iran. As a persistent oversupply caps oil prices around $50 a barrel and OPEC’s output quotas limits production, Iraq’s looking to squeeze every drop of value out of its crude. […]

Mideast oil producers on low-level alert after Iraq pricing switch

30 Aug 2017   Iraq, Prices

Gulf OPEC members Saudi Arabia and Kuwait are unlikely to follow Iraq in a major shift in the way it prices its oil in Asia and will monitor Baghdad’s attempts to squeeze more dollars from its reform, industry sources said. Last week, Iraq’s state-oil firm SOMO began consultations with traders on its plans to switch to the Dubai Mercantile Exchange (DME) for its Asian oil pricing from Platts’ quotes, which Baghdad and neighboring Middle Eastern producers Saudi Arabia, Kuwait and Iran have used for decades. The move throws down the gauntlet on setting prices for more than 12 million barrels per day of Middle East crude in Asia, challenging the role of the world’s top exporter Saudi Arabia. Smaller producers have traditionally followed […]

Siba preparing year-end commercial gas production

30 Aug 2017   Iraq

The first successful project from Iraq’s third bidding round, in 2010, is on track to reach plateau production within five years. A worker at the Siba gas field on Aug. 26, 2017, preparing for commercial gas production of 25 million standard cubic feet per day by the end of the year. (ALI AL-AQILY/Iraq Oil Report) SIBA – The Siba gas field, operated by Kuwait Energy, is slated to reach commercial production of 25 million standard cubic feet per day (scf/d) by the end of the year and hit its contracted plateau production of 100 million scf/d within five years. At a visit to the field on Saturday, Iraq Oil Report was told by senior field development officials that work to reach first commercial production is 92 percent complete.

Foiled spy plot strains Turkey-KRG relations

29 Aug 2017   Iraq, Turkey

The Kurdistan Workers’ Party (PKK) has captured four Turkish intelligence operatives in Sulaimaniya after they attempted to arrest or assassinate a top leader of the Kurdish guerrilla group. The incident is putting an acute strain on relations between Iraqi Kurds and the Turkish government at a critical moment. Ankara has already expressed opposition to a Kurdistan Regional Government (KRG) independence referendum scheduled for Sept. 25, largely for fear that it would bolster Kurdish separatists like the PKK in Turkey.

Iraq faces resistance from Asian buyers on ‘ambitious’ oil price change

26 Aug 2017   Iraq

Iraq’s proposal to change the way it prices crude oil in Asia faces resistance from refiners who fear that longer lead times between pricing and deliveries will expose them to more risk. Iraq’s state oil marketer SOMO surprised traders this week by seeking feedback on plans to switch its Basra crude benchmark in Asia to pricing based off the Dubai Mercantile Exchange from January 2018, dropping quotes based on assessments by oil pricing agency S&P Global Platts. The move would affect the price of about 2 million barrels per day (bpd) of crude oil supplies to Asia, mainly shipped to India, China and South Korea. “The change is significant and will be watched very closely by not only Middle East producers but everyone involved,” said Oystein Berentsen, managing director for Strong Petroleum in Singapore. The new method would price Basra crude using the monthly average of […]

Kurdish oil export payments boost DNO’s performance

25 Aug 2017   Iraq

Norwegian energy company DNO said its overall performance was stimulated by regular payments for oil exported from the Kurdish north of Iraq. Photo courtesy DNO Aug. 24 (UPI) — Revenues for the first half of the year were up more than 40 percent from last year in part because of export payments from the Kurdish north of Iraq, DNO said. DNO, a Norwegian oil and gas company, has a strong presence in the Kurdish region of Iraq, with a net operated production of 114,000 barrels of oil equivalent per day during the first half of the year. At its Tawke license area in the region, gross production averaged 108,434 barrels of oil per day, of which 99.3 percent was sent through pipelines north for exports from Turkey. Revenues in the first half of the year were up 43 percent in part because of regular payments for exports by the […]

KRG reaches landmark deal with DNO and Genel

25 Aug 2017   Iraq

Iraq’s autonomous Kurdistan Regional Government (KRG) on Thursday gave extra project equity and profit payments to two of its earliest international oil investors to absolve outstanding debts – a deal that could seriously reduce financial risk and pave the way for quicker growth in the industry. Neither Norway’s DNO, Anglo-Turkish Genel Energy or the KRG’s Ministry of Natural Resources (MNR) have made public the overall amount of unpaid exports and other receivables – estimated by Iraq Oil Report at more than $1 billion – that will be waived in the […]

Revolution or evolution? Iraq shakes up Asian oil trading: Russell

25 Aug 2017   Iraq, Prices

There is little doubt that Iraq’s mooted shift to using Dubai crude futures from long-standing price assessor Platts will shake up the trading of Middle East oil, but is it a once-off shock or the first of the dominoes to fall. Iraq’s state oil marketer SOMO has asked its customers for feedback on a planned move to use Oman futures traded on the Dubai Mercantile Exchange (DME) instead of the average of Platts’ Oman-Dubai quotes in pricing its main Basra grade. [nL4N1L71IB] While this may seem an esoteric issue to those outside the cosy world of physical oil trading, it represents a potential seismic shift in the way that more than 12 million barrels per day (bpd) of crude is bought and sold in the Middle East, which is still the world’s […]

Kurdish Independence Could Deal A Major Blow To Oil Markets

25 Aug 2017   Iraq, Kurdistan

The future stability of OPEC’s second-largest oil and gas producer could be decided by the end of 2017. Unrest is growing in Iraq as the Kurdish referendum grows nearer. Soon, the Iraq that we have known since the end of WWII could be drawing new borders. At the same time, the conflict between the Shi’a (supported by Iran) and the Sunni (Saudi-UAE) could be heating up again. Regional actors and political friction have added fuel to the fire, in the first signs that the strong Shi’a majority is experiencing internal instability. One of the main leaders of the region’s Shi’a has broken ranks in Iran’s Shi’a led government factions just as Sunni power players in the Arab Gulf are expecting a collapse of the Shi’a power triangle of Iran-Iraq-Syria. The unexpected visit of Shi’ite cleric and power broker Muqtada Al Sadr to Saudi Arabia and the UAE has stirred […]

Turkish foreign minister says to tell Iraqi Kurdish officials independence vote wrong

23 Aug 2017   Kurdistan, Turkey

Turkish Foreign Minister Mevlut Cavusoglu speaks during a news conference at the European Commission in Brussels, Belgium July 25, 2017. ANKARA (Reuters) – Turkish Foreign Minister Mevlut Cavusoglu said on Wednesday he would tell Iraqi Kurdish officials later in the day that their decision to hold an independence referendum was wrong and that Ankara expects it to cancel the vote. Cavusoglu was speaking at a news conference in Baghdad with his Iraqi counterpart before traveling to Erbil in northern Iraq to meet Kurdish officials later on Wednesday.

In Breakaway Move From Saudis, Iraq May Change Oil Pricing

22 Aug 2017   Iraq, Prices

In a bid to increase oil revenues and possibly setting the stage for its own benchmark crude grade, Iraq has told customers it may change the way it prices Basra crude for the Asian market, Reuters reported on Monday, quoting a letter by Iraq’s state oil marketing company SOMO it had seen. According to SOMO’s letter, the company is asking customers for input regarding a plan to change the Basra crude pricing for Asia to Dubai Mercantile Exchange (DME) Oman futures beginning next year, dropping the average of Oman and Dubai quotes by S&P Global Platts. “In an effort to realize the intrinsic value of our crude exports to Asia as to be in alignment with the recent market perception, we are contemplating a change of the current pricing formula for the Asian market,” Reuters quoted SOMO’s letter as saying. The letter is dated August 20 and asks for […]

Garraf oil field attacked

21 Aug 2017   Iraq

Attackers opened fire with machine guns and a rocket-propelled grenade (RPG) near a gas-oil separation station at the Garraf oil field in southern Dhi Qar province Friday evening. The characteristics of the attack do not bear the hallmarks of the self-proclaimed Islamic State (IS) group, and the provincial police chief said residents are upset at a series of recent earthquakes for which they blame oil operations. Three residents of a nearby village have been arrested. This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free trial .

Iraq plans to shift Basra crude price benchmark for Asia from January

21 Aug 2017   Iraq

Iraq has informed its customers that it plans to change its price benchmark for Basra crude in Asia to DME Oman futures from January, the country’s latest move to reform its oil sales. The proposed change by state-oil marketer SOMO would mark a major shift by OPEC’s second-largest producer away from fellow members Saudi Arabia, Kuwait and Iran, which have been using price assessments from global agency S&P Global Platts as their benchmark for decades. It throws down the gauntlet on setting prices for more than 12 million barrels per day of Middle East crude in Asia, challenging the role of the world’s top exporter Saudi Arabia. “In an effort to realize the intrinsic value of our crude exports to Asia as to be in alignment with the […]

Former Exxon advisor likely to succeed ousted Basra governor

18 Aug 2017   Iraq

In the wake of a scandal that led to the sudden resignation of Basra’s governor, Taha al-Tamimi has emerged as the top candidate to lead Iraq’s oil capital. Basra’s then-governor, Majid al-Nasrawi (L), walks with Iraqi President Fuad Masum in Basra on Feb. 23, 2015. (ESSAM AL-SUDANI/Reuters) BASRA – Days after the sudden resignation of Basra Gov. Majid al-Nasrawi, a former ExxonMobil advisor has emerged as the top candidate to replace him as the leader of Iraq’s oil capital. Taha al-Timimi, who managed government relations for Exxon’s Iraq operations from 2010 to 2014, has won the endorsement of Oil Minister Jabbar al-Luiebi and his powerful political party, the newly formed Hikma movement (Arabic for “Wisdom”). This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free trial .

Turkey Expands Influence In Kurdish Energy Sector

17 Aug 2017   Iraq, Turkey

Over the past 12 years, Turkish energy companies have moved into the Kurdish energy sector at great pace in line with the sector’s rapid expansion under the semi-independent government in Erbil. Energy cooperation between the Kurdistan Regional Government (KRG) and the Turkish government is the single greatest factor for energy companies’ involvement in the region and the commercial realization of this cooperation is no doubt the result of high-level political alignment. The recent downturn in the global petroleum market, the outbreak of war in North-Western Iraq, and internal political tensions have dampened investors’ expectations vis-à-vis energy sector viability in Iraqi Kurdistan. However, questions still remain as to which parties were the key beneficiaries of energy cooperation and how some of the most lucrative contracts were negotiated during the sector’s peak – many of these parties are primed to benefit should the industry pick up again. Humble Origins The KRG […]

With a wary eye on Iran, Saudi and Iraqi leaders draw closer

17 Aug 2017   Iraq, Saudi Arabia

It was an unusual meeting: An Iraqi Shi’ite Muslim cleric openly hostile to the United States sat in a palace sipping juice at the invitation of the Crown Prince of Saudi Arabia, the Sunni kingdom that is Washington’s main ally in the Middle East. For all the implausibility, the motivations for the July 30 gathering in Jeddah between Moqtada al-Sadr and Crown Prince Mohammed bin Salman run deep, and center on a shared interest in countering Iranian influence in Iraq. For Sadr, who has a large following among the poor in Baghdad and southern Iraqi cities, it was part of efforts to bolster his Arab and nationalist image ahead of elections where he faces Shi’ite […]

Kurdish oil player sees steady production course ahead

15 Aug 2017   Iraq

Gulf Keystone Petroleum sees its legacy embedded in the Kurdish north of Iraq with 40 million barrels of production. Photo courtesy Gulf Keystone Petroleum Aug. 14 (UPI) — Production from the semi-autonomous Kurdish region of northern Iraq remains at the high-end of expectations for the year, a company said. Gulf Keystone Petroleum operates the Shaikan oil field in Kurdish northern Iraq. The company said Monday it was notified by the government of a gross payment of $15 million for oil exported from the field in April. Gulf Keystone reported total average gross production for 2016 at 34,794 barrels of oil per day, at the upper range of its guidance for the year. The company said the field is performing as expected as output should average about 36,671 barrels of oil per day for the first half of the year. The company said it expects gross production for the year […]

Saudis ready to export more oil to Iraq

12 Aug 2017   Iraq, Saudi Arabia

After discussions on compliance with an OPEC-led effort to balance the market, Saudi Arabia’s energy minister said Iraq could be the target for more exports. Saudi Arabia and Iraq are the top two oil producers among members of the Organization of Petroleum Exporting Countries. Saudi Arabia has taken a “whatever it takes” stance on a multilateral effort to balance an oversupplied market for crude oil with production declines, while Iraq is said to be the least compliant among parties to the arrangement. Saudi Energy Minister Khalid al-Falih said his country was willing to “open all fields” in order to improve bilateral relations with its ally, Iraq. “The minister said that the kingdom is keen to supply Iraq with Saudi exports of […]

Iraq’s Kurds maintain Sept. 25 as date for independence referendum, Kurdish official says

12 Aug 2017   Iraq

Iraq’s Kurds will maintain their plan to hold a referendum on independence on Sept. 25, despite a U.S. request to postpone it, a high-ranking Kurdish official told Reuters on Saturday. “The date is standing, Sept. 25, no change,” said Hoshyar Zebari, a close adviser to Kurdistan Regional Government President Massoud Barzani, commenting on the request communicated by U.S. Secretary of State Rex Tillerson. The U.S. State Department said in June it was concerned that the referendum will distract from “more urgent priorities” such as the defeat of Islamic State militants.

Rivers of crude spill from IS smuggling operation

9 Aug 2017   Iraq

Militants from the self-proclaimed Islamic State (IS) are continuing to steal oil from Iraqi fields in the mountains of Salahaddin province, in a primitive operation that has created a massive oil spill covering thousands of acres. More than two years after government forces launched an effort to secure the area, IS militants still control about 75 percent of the Alas Dome – one of the three formations that compose the Hamrin field – according to an official from the state-run North Oil Company (NOC).

Iraqi oil wealth not enough for broad economic growth

7 Aug 2017   Iraq

Moody’s gives Iraq its third-lowest rating, saying political risks and lack of diversity offset is oil wealth. Photo by cherezoff/Shutterstock Aug. 4 (UPI) — Corruption and internal political rifts could be factors weighing on the economy of OPEC-member Iraq, a report from Moody’s Investors Service said. Moody’s gave Iraq a Caa rating, its third lowest. Entities rated Caa are exposed to “very high” credit risks. The report, emailed to UPI on Friday, found Iraq was well-endowed with oil wealth, but lacks economic growth opportunities from other sectors. Iraq is a member of the Organization of Petroleum Exporting Countries and party, albeit reluctantly, to a multilateral effort to stem production in order to balance an oversupplied market for crude oil. According to secondary sources reporting to OPEC, production in June, the last full month for which data are available, was 4.5 million barrels per day, an increase of more than […]