Tuesday, September 04, 2007
Fuel prices soar ahead of winter
Fuel
(Azzaman) - Kerosene prices have skyrocketed owing to the surge in demand as winter approaches. Iraqis use mainly kerosene for heating and the one million liters a day Iraqi refineries produce hardly meet a fraction of domestic needs. Baghdad alone needs four million liters a day during the three winter months in central Iraq, according to Maeen al-Kadhimi, head of Baghdad provincial council.
He said the Ministry of Oil has no capacity to furnish Baghdad with its needs. He said he feared fuel crisis this winter will be harsher in the years since the U.S. invasion. The country needs at least 15 million liters of kerosene a day to meet the need for heating in winter but Kadhimi said there was no way for the Oil Ministry to make such a huge volume available.
Iraq currently imports most of its fuel needs. The country’s fuel import bill has ballooned to billions of dollars a year. Iraq’s refineries, which prior to the U.S. invasion could meet almost all of the country’s needs for fuel, are operating at much below the capacity. The Oil Ministry has a contract with Iran for the supply of 1.5 million liters of only kerosene every day but Kadhimi said Iran could only deliver half a million liters a day.
He said the Ministry of Oil has no capacity to furnish Baghdad with its needs. He said he feared fuel crisis this winter will be harsher in the years since the U.S. invasion. The country needs at least 15 million liters of kerosene a day to meet the need for heating in winter but Kadhimi said there was no way for the Oil Ministry to make such a huge volume available.
Iraq currently imports most of its fuel needs. The country’s fuel import bill has ballooned to billions of dollars a year. Iraq’s refineries, which prior to the U.S. invasion could meet almost all of the country’s needs for fuel, are operating at much below the capacity. The Oil Ministry has a contract with Iran for the supply of 1.5 million liters of only kerosene every day but Kadhimi said Iran could only deliver half a million liters a day.
Labels: kerosene, Oil Ministry
Wednesday, July 04, 2007
Baghdad Governorate Council Has New Plan To Run Private Fuel Stations In Baghdad
Economy
(Badr Newspaper) - 3 JUL - Baghdad Governorate Council has agreed with the Oil Ministry to form a joint committee to create a plan to run private fuel stations. During a meeting held in the Oil Ministry headquarters and which was attended by Mr. Nazar Al Sultan, the Council’s Energy Committee Chief, and Mr. Mutasim Akram Hassan, an Oil Ministry advisor. Nazar Sultan said, “A technical and a legal committee will be formed that includes Baghdad Governorate Council members and Iraqi oil experts to create a plan to operate private fuel stations in Baghdad and to support the private sector.”
In related news, the Baghdad Governorate Council members discussed the subject of providing Baghdad Municipality with gasoline. The issue of supplying Baghdad Municipality with diesel was discussed for the purpose of carrying out projects and operating “pumping stations.” The council members decided to provide Baghdad Municipality with the gasoline that it needs.
In related news, the Baghdad Governorate Council members discussed the subject of providing Baghdad Municipality with gasoline. The issue of supplying Baghdad Municipality with diesel was discussed for the purpose of carrying out projects and operating “pumping stations.” The council members decided to provide Baghdad Municipality with the gasoline that it needs.
Mr. Nazar Al Sultan spoke about the fuel crisis in Baghdad and he called for a quick solution to this crisis. The Oil Ministry advisor stated that the reasons behind this crisis are corruption and the small number of fuel stations in Baghdad. He confirmed, “We have enough fuel but there are technical and security reasons that prevent us from providing Baghdad with more fuel.”
Mr. Mutasim Akram Hassan, the Oil Ministry Advisor for Distribution Efforts said, “The Oil Ministry has created a number of steps to resolve the fuel crisis, such as selling fuel directly to citizens who need it for small generators.” Nazar Al Sultan, the Energy Committee Chief, called for the distribution of fuel through the district councils and the Baghdad Governorate Council must be responsible for this matter. Al Sultan clarified that Dora Refinery needs to be used to its capacity to provide Baghdad with fuel.
Labels: Baghdad Governorate Council, corruption, Dora refinery, fuel stations, Oil Ministry, privatisation
Thursday, June 07, 2007
Iraqi military surrounds Iraq Pipelines Union on strike in Basra
Oil
(UPI) - On the third day of an oil strike in southern Iraq, the Iraqi military has surrounded oil workers and the prime minister has issued arrest warrants for the union leaders, sparking an outcry from supporters and international unions. "This will not stop us because we are defending people's rights," said Hassan Jumaa Awad, president of IFOU. As of Wednesday morning, when United Press International spoke to Awad via mobile phone in Basra at the site of one of the strikes, no arrests had been made, "but regardless, the arrest warrant is still active." He said the "Iraqi Security Forces," who were present at the strike scenes, told him of the warrants and said they would be making any arrests.
The arrest warrant accuses the union leaders of "sabotaging the economy," according a statement from British-based organization Naftana, and said Maliki warned his "iron fist" would be used against those who stopped the flow of oil. IFOU called a strike early last month but put it on hold twice after overtures from the government. Awad said that at a May 16 meeting, Maliki agreed to set up a committee to address the unions' demands.
The demands include union entry to negotiations over the oil law they fear will allow foreign oil companies too much access to Iraq's oil, as well as a variety of improved working conditions. "Apparently they promise but they never do anything," Awad said, confirming reports the Iraqi Oil Ministry would send a delegation to Basra.
"One person from the Ministry of Oil accompanied by an Iraqi military figure came to negotiate the demands. Instead it was all about threats. It was all about trying to shut us up, to marginalize our actions," Awad said. "The actions we are taking now are continuing with the strike until our demands are taken in concentration."
The strike by the Iraq Pipelines Union in Basra started Monday, instigated by a decision by the Iraq Pipelines Company to stop regular bonuses to workers. It is part of a larger picture, however, of 17 different demands laid out -- beginning last month -- to the Iraq Oil Ministry and Prime Minister Nouri al-Maliki by the Iraq Federation of Oil Unions.
Since the strike began, two small pipelines delivering oil products to Baghdad and other cities have been closed, as has a larger pipeline that sends gas and oil to major cities, including Baghdad, and utilities. The strike started with domestic pipelines transporting oil and oil products, but Iraq's top oil unionist says it will soon encapsulate the 1.6 million barrels per day of oil Iraq sends to the global market.
Basra, home to much of Iraq's 115 billion barrels of oil -- the third-largest reserves in the world -- is also Iraq's main port. Awad said the unions will continue to restrict all oil exports, which bring in 93 percent of Iraq's federal budget funds. Such a move, combined with the choking off of much-needed supplies of transportation, cooking and heating fuels, is what the unions hopes to use as leverage against Maliki.
Awad said "the atmosphere here is full of tension," and added that he wants to pressure the government to agree to their demands, not topple an already-weak Maliki government. "At the end we are hoping that the situation will not go that way," Awad said.
Manfred Warda, general secretary of the International Federation of Chemical, Energy, Mine and General Workers' Unions, Wednesday sent a letter to Maliki condemning his tactics in addressing the strike. The Brussels-based International Trade Union Confederation and London-based Trades Union Congress have also condemned the military action and arrest warrants. A top official with the International Federation of Chemical, Energy, Mine & General Workers' Union said his contacts say the strike had been toned down while negotiations were underway, but has not ended.
Kamil Mahdi, an Iraqi economist on Middle East affairs at the University of Exeter, said Maliki's swing from agreement with the unions to a military presence and warrants is "very surprising," and arresting the leaders won't quell the workers' demands. "It may be the opposite. These are people who are highly respected in the community," he said. If the strike isn't stopped soon, "the effect on the global oil market will certainly be felt."
The arrest warrant accuses the union leaders of "sabotaging the economy," according a statement from British-based organization Naftana, and said Maliki warned his "iron fist" would be used against those who stopped the flow of oil. IFOU called a strike early last month but put it on hold twice after overtures from the government. Awad said that at a May 16 meeting, Maliki agreed to set up a committee to address the unions' demands.
The demands include union entry to negotiations over the oil law they fear will allow foreign oil companies too much access to Iraq's oil, as well as a variety of improved working conditions. "Apparently they promise but they never do anything," Awad said, confirming reports the Iraqi Oil Ministry would send a delegation to Basra.
"One person from the Ministry of Oil accompanied by an Iraqi military figure came to negotiate the demands. Instead it was all about threats. It was all about trying to shut us up, to marginalize our actions," Awad said. "The actions we are taking now are continuing with the strike until our demands are taken in concentration."
The strike by the Iraq Pipelines Union in Basra started Monday, instigated by a decision by the Iraq Pipelines Company to stop regular bonuses to workers. It is part of a larger picture, however, of 17 different demands laid out -- beginning last month -- to the Iraq Oil Ministry and Prime Minister Nouri al-Maliki by the Iraq Federation of Oil Unions.
Since the strike began, two small pipelines delivering oil products to Baghdad and other cities have been closed, as has a larger pipeline that sends gas and oil to major cities, including Baghdad, and utilities. The strike started with domestic pipelines transporting oil and oil products, but Iraq's top oil unionist says it will soon encapsulate the 1.6 million barrels per day of oil Iraq sends to the global market.
Basra, home to much of Iraq's 115 billion barrels of oil -- the third-largest reserves in the world -- is also Iraq's main port. Awad said the unions will continue to restrict all oil exports, which bring in 93 percent of Iraq's federal budget funds. Such a move, combined with the choking off of much-needed supplies of transportation, cooking and heating fuels, is what the unions hopes to use as leverage against Maliki.
Awad said "the atmosphere here is full of tension," and added that he wants to pressure the government to agree to their demands, not topple an already-weak Maliki government. "At the end we are hoping that the situation will not go that way," Awad said.
Manfred Warda, general secretary of the International Federation of Chemical, Energy, Mine and General Workers' Unions, Wednesday sent a letter to Maliki condemning his tactics in addressing the strike. The Brussels-based International Trade Union Confederation and London-based Trades Union Congress have also condemned the military action and arrest warrants. A top official with the International Federation of Chemical, Energy, Mine & General Workers' Union said his contacts say the strike had been toned down while negotiations were underway, but has not ended.
Kamil Mahdi, an Iraqi economist on Middle East affairs at the University of Exeter, said Maliki's swing from agreement with the unions to a military presence and warrants is "very surprising," and arresting the leaders won't quell the workers' demands. "It may be the opposite. These are people who are highly respected in the community," he said. If the strike isn't stopped soon, "the effect on the global oil market will certainly be felt."
Labels: Basra, Hassan Jumaa Awad, IFOU, Iraq Pipelines Union, Iraqi military, Oil Ministry, oil workers, strikes
Friday, April 27, 2007
Iraqi oil ministry says oil contracts not signed with central govt. will be considered illegal
Oil
(Reuters) - Iraq's oil ministry said on Thursday foreign firms should sign oil contracts only with the central government until a new oil law is passed, adding that deals outside its jurisdiction would be considered illegal.
An oil industry source told Reuters the warning, made in a ministry statement after Oil Minister Hussain al-Shahristani met the Russian envoy to Baghdad, referred to contracts signed recently without the approval of the central government.
"Foreign companies should only sign contracts through the central government and the oil ministry. The ministry warns companies who violate Iraqi law of the consequences of their actions and any contract that is signed outside the jurisdiction of the central Iraqi government is considered illegal." Iraq's Kurdistan regional government has signed several agreements with foreign companies, including a service contract last week with United Arab Emirate's Dana Gas.
While Kurds favour agreements that would share production with foreign firms, such deals have drawn criticism from some Shi'ite and Sunni Arab nationalists. Ashti Hawrami, the Kurdish region's minister of natural resources, said it could clinch deals with any company it chose. "If they do not want to agree on the remaining contentious points we will implement our own laws for the Kurdistan region according to the constitution," he told Reuters.
Iraq's central government and Kurdish officials are currently trying to resolve disputes over the draft oil law, which would determine control of the world's third-largest oil reserves. The law has yet to be approved by parliament. Hawrami has said annexes to the draft law that would wrest oilfields from regional governments and place them under a new state-oil company are unconstitutional.
Shares of Norway's DNO, an independent producer about to start drilling for oil at its Tawke field in the Kurdish-controlled north, fell as much as 4.5 percent after the oil ministry comments appeared to cast doubt on its production agreement with the Kurdish region. Shares later pared their losses. An oil industry source told Reuters in Baghdad that the Iraqi government had no problem with a "Norwegian firm" that had signed a deal with the Kurds, without specifying DNO by name. In Olso, DNO said it was confident about the validity of its oil production deal with Iraq's regional Kurdish authorities.
Iraq's Deputy Prime Minister Barham Salih, an architect of the draft oil law, told Reuters after the cabinet passed it in February that it would allow the Kurdish regional government to review existing contracts it has signed with foreign firms to ensure consistency with the terms of the new law. Salih said a commission of independent experts would ratify consistency in case of contention and that regional authorities would be able to negotiate oil contracts with foreign companies based on "maximising revenues for Iraqi people."
An oil industry source told Reuters the warning, made in a ministry statement after Oil Minister Hussain al-Shahristani met the Russian envoy to Baghdad, referred to contracts signed recently without the approval of the central government.
"Foreign companies should only sign contracts through the central government and the oil ministry. The ministry warns companies who violate Iraqi law of the consequences of their actions and any contract that is signed outside the jurisdiction of the central Iraqi government is considered illegal." Iraq's Kurdistan regional government has signed several agreements with foreign companies, including a service contract last week with United Arab Emirate's Dana Gas.
While Kurds favour agreements that would share production with foreign firms, such deals have drawn criticism from some Shi'ite and Sunni Arab nationalists. Ashti Hawrami, the Kurdish region's minister of natural resources, said it could clinch deals with any company it chose. "If they do not want to agree on the remaining contentious points we will implement our own laws for the Kurdistan region according to the constitution," he told Reuters.
Iraq's central government and Kurdish officials are currently trying to resolve disputes over the draft oil law, which would determine control of the world's third-largest oil reserves. The law has yet to be approved by parliament. Hawrami has said annexes to the draft law that would wrest oilfields from regional governments and place them under a new state-oil company are unconstitutional.
Shares of Norway's DNO, an independent producer about to start drilling for oil at its Tawke field in the Kurdish-controlled north, fell as much as 4.5 percent after the oil ministry comments appeared to cast doubt on its production agreement with the Kurdish region. Shares later pared their losses. An oil industry source told Reuters in Baghdad that the Iraqi government had no problem with a "Norwegian firm" that had signed a deal with the Kurds, without specifying DNO by name. In Olso, DNO said it was confident about the validity of its oil production deal with Iraq's regional Kurdish authorities.
Iraq's Deputy Prime Minister Barham Salih, an architect of the draft oil law, told Reuters after the cabinet passed it in February that it would allow the Kurdish regional government to review existing contracts it has signed with foreign firms to ensure consistency with the terms of the new law. Salih said a commission of independent experts would ratify consistency in case of contention and that regional authorities would be able to negotiate oil contracts with foreign companies based on "maximising revenues for Iraqi people."
Labels: Ashti Hawrami, Baghdad government, Barham Salih, Dana gas, DNO, draft oil law, Hussain al-Shahristani, Norway, Oil Ministry, UAE
Wednesday, April 04, 2007
$8 billion lost in corruption since 2003
Corruption
(AFP) - Iraq has lost some $8 billion to administrative and financial corruption since the 2003 US-led invasion which toppled the Saddam Hussein regime, an anti-corruption panel said on Tuesday. "The estimated value of the wasted sum because of administrative and financial corruption is eight billion dollars," Radi al-Radhi, the head of the country's anti-corruption committee, said in a statement e-mailed to news organizations.
He blamed the Constitution for some of the funds lost, saying a clause in the Iraqi law blocked the launching of legal action against government employees. "Article 136 B stipulates that no civil servant should be sent for trial before the consent of his minister," the statement quoted Radhi as saying. The article was obstructing investigations into the "lost money."
The official said that efforts were being made to abolish the clause from the Constitution and clear the way for action against employees accused of fraud and corruption. Radhi also revealed his panel was investigating around 180 employees of the Oil Ministry in the southern port city of Basra following reports of corruption, but it was not known whether they will face trial.
He blamed the Constitution for some of the funds lost, saying a clause in the Iraqi law blocked the launching of legal action against government employees. "Article 136 B stipulates that no civil servant should be sent for trial before the consent of his minister," the statement quoted Radhi as saying. The article was obstructing investigations into the "lost money."
The official said that efforts were being made to abolish the clause from the Constitution and clear the way for action against employees accused of fraud and corruption. Radhi also revealed his panel was investigating around 180 employees of the Oil Ministry in the southern port city of Basra following reports of corruption, but it was not known whether they will face trial.
Labels: corruption, Oil Ministry, Radi al-Radhi
Thursday, March 15, 2007
$1 billion oil refinery to be built in Karbala
Reconstruction, Oil
(VOI) Iraqi oil ministry agreed to build a large oil refinery in Karbala, 110 km southwest of Baghdad, head of Karbala provincial council said on Tuesday. "The oil minister informed the provincial council during his visit to Karbala two days ago that the ministry agreed to build a large refinery in the province," Abdul-Al al-Yasseri told the independent news agency Voices of Iraq (VOI).
The official who did not set a date for commencing construction works in the project said "the oil ministry announced the project tender and is waiting for bids by international companies." He added, "the refinery designed capacity is 140,000 bpd." The new refinery will be set up on the highway linking Karbala to Najaf, 20 km south of Karbala while construction works are expected to continue for four years, al-Yasseri added. He said "the cost of building the refining facility is estimated at one billion U.S. dollars."
Labels: Karbala, Oil Ministry, oil refinery
Friday, March 09, 2007
Oil Ministry to raise price of fuel products
Fuel
(Azzaman) The Oil Ministry will have to hike prices of fuel products which are currently sold at highly subsidized rates, according to the minister Hussein Shahristani. The minister made the remarks ahead of a meeting with the International Monetary Fund which is coordinating the writing off of Iraqi debts. Shahristani said Iraq is obliged to honor the pledges it has made to the fund in return for financial assistance.
He did not say when the ministry will introduce the new rates but added the country will eventually have to reduce its huge fuel subsidies. Despite the subsidies, which are reported to cost hundreds of millions of dollars each month, Iraq still suffers from chronic fuel shortages. Subsidized fuel is hard to obtain and most Iraqis are forced to buy on the spot market at exorbitant rates.
Iraq currently imports huge volumes of fuel despite its massive oil wealth. But the selling and distribution of fuel is the type of economic activity where corrupt officials and profiteers are cashing in. Shahristani said the IMF has asked Iraq to raise fuel prices to levels comparable to those in neighboring countries.
He did not say when the ministry will introduce the new rates but added the country will eventually have to reduce its huge fuel subsidies. Despite the subsidies, which are reported to cost hundreds of millions of dollars each month, Iraq still suffers from chronic fuel shortages. Subsidized fuel is hard to obtain and most Iraqis are forced to buy on the spot market at exorbitant rates.
Iraq currently imports huge volumes of fuel despite its massive oil wealth. But the selling and distribution of fuel is the type of economic activity where corrupt officials and profiteers are cashing in. Shahristani said the IMF has asked Iraq to raise fuel prices to levels comparable to those in neighboring countries.
Labels: Hussain al-Shahristani, IMF, Oil Ministry
Monday, February 26, 2007
Confusion between Kurds and Oil Ministry on draft oil law
Oil
(The Guardian) The Oil Ministry cast doubt Sunday on statements indicating the Kurds had agreed to support a draft oil law that would divide revenues among all Iraqi factions and meet a key U.S. benchmark in Iraq. Prime Minister Nouri al-Maliki's government had promised to enact a new oil law by the end of 2006 but missed the deadline due to objections from the Kurds.
Many of Iraq's vast oil reserves can be found in the Kurdish north and the Shiite south, and the Kurds wanted a greater role in awarding contracts and administering the revenues. Massoud Barzani, president of the self-governing Kurdish administration in the north, said Saturday that he and President Jalal Talabani, a Kurd, had discussed the latest draft law by telephone with al-Maliki and "the results were good.''
Barzani made the comments in a joint press conference with Talabani after a meeting with U.S. Ambassador Zalmay Khalilzad in the northern Kurdish city of Sulaimaniyah. "We reached a final agreement,'' Barzani said, without elaborating. "We accept the draft.'' An Oil Ministry spokesman, however, stressed that the draft law still needed to be discussed at the Cabinet level. "Today, we got confirmation that Barzani said that they support the draft law but he mentioned nothing about agreeing to it,'' ministry spokesman Assem Jihad said. "The discussions and the negotiations are still ongoing.''
It was unclear if Barzani was saying he supported the idea of a law or the draft as currently worded. Kurdish officials could not be reached for clarification.
Barzani made the comments in a joint press conference with Talabani after a meeting with U.S. Ambassador Zalmay Khalilzad in the northern Kurdish city of Sulaimaniyah. "We reached a final agreement,'' Barzani said, without elaborating. "We accept the draft.'' An Oil Ministry spokesman, however, stressed that the draft law still needed to be discussed at the Cabinet level. "Today, we got confirmation that Barzani said that they support the draft law but he mentioned nothing about agreeing to it,'' ministry spokesman Assem Jihad said. "The discussions and the negotiations are still ongoing.''
It was unclear if Barzani was saying he supported the idea of a law or the draft as currently worded. Kurdish officials could not be reached for clarification.
Labels: draft oil law, Kurdistan, Massoud Barzani, Oil Ministry
