Thursday, August 09, 2007
Shahristani in Moscow for talks with oil companies
Oil
(The Moscow Times) - Iraq's oil minister arrived in Moscow late Wednesday for talks with Industry and Energy Minister Viktor Khristenko and senior oil executives and said he would offer new terms for Russian companies seeking to work in the war-torn country. Officials from a consortium of three Russian companies -- LUKoil, Zarubezhneft and Mashinoimport -- are expected to meet on Thursday with Iraqi Oil Minister Hussain al-Shahristani in a bid to regain access to the country's oil fields.
In particular, the companies will be hoping to revive a $4 billion deal to develop the 600,000 barrel-per-day West Qurna field, which was scrapped by dictator Saddam Hussein shortly before the U.S.-led invasion in 2003. "Iraq will cooperate with those companies that will propose the best conditions for Iraq, regardless of what countries these companies come from," Shahristani said on his arrival in Moscow, RIA-Novosti reported. Shahristani said no country would get preferential treatment in the competition for Iraqi oil assets. "LUKoil will be competing with other firms on equal terms in accordance with the new oil laws." If LUKoil proposes projects that are competitive enough, it will get the contracts, Shahristani said. LUKoil will likely be hoping to make use of its 20 percent U.S. shareholder, ConocoPhillips, to ease its way back into the country. LUKoil has offered Conoco a 17.5 percent stake in the West Qurna project.
In May, the Iraqi government said it was not prepared to accept a Russian offer to forgive $10 billion in Hussein-era debt in exchange for giving Russian companies access to another major oil field, in Rumaila, Reuters reported. The visit comes as the Iraqi government readies a new law governing foreign investment in the country's oil industry, which has struggled to recover from underinvestment under Hussein and disruption by terrorist attacks under the U.S.-led occupation.
Semakov said LUKoil would create some 2,000 jobs for Iraqis in one field at West Qurna alone. The company has invested "tens of millions of dollars" in the project but would plow in much more in the future, he said.As the invasion of Iraq began, the Russian firms had to abandon their projects and evacuate staff.
Labels: ConocoPhillips, Hussain al-Shahristani, LUKoil, Mashinoimport, Rumaila field, Russia, Viktor Khristenko, West Qurna, Zarubezhneft
Wednesday, April 25, 2007
Russian govt. backs LUKoil's bid to develop Iraqi oil field
Oil, Business
(Financial Times) - The Russian government is throwing its full support behind Lukoil's ambition to become the first big international energy group to develop a major Iraqi oil field following the 2003 US invasion.
Vagit Alekperov, Lukoil's chief executive, said in an interview on Tuesday: "The Russian government supports us, the foreign ministry supports us, the president of the federation supports us. They support the idea of putting those Iraqi fields [into production] as soon as possible. In all these areas we have the support of the Russian government."
He added that Lukoil would be able to develop the West Qurna field two to three times more quickly than any other company. "We are ready to move really fast," he said. "The situation in South Iraq is pretty stable and we have no problem starting operations right after the passage of the hydrocarbon law and once we have the necessary approvals," he said. Iraq's parliament aims to pass the law by the end of next month.
West Qurna is believed to hold as many as 11bn-15bn barrels of recoverable oil reserves and has a potential to produce as many as 1m barrels a day, making it one of the world's biggest fields. International energy companies such as ExxonMobil, Royal Dutch Shell and BP have been waiting for the security situation in Iraq to improve before developing fields, and analysts believe the situation in the Shia-dominated region close to the southern port of Basra where West Qurna is located is far from predictable.
But at least one US company would benefit if Iraq's oil ministry assigned the development of West Qurna to Lukoil. In 2004 ConocoPhillips, the US's third largest energy group, formed a strategic partnership with Lukoil in which the US company gradually expanded its stake to just shy of 20 per cent. At the time of the announcement, the companies noted the eventually development of West Qurna as one of their motives for the deal.
Lukoil has spent more than a decade angling for West Qurna. In spite of United Nations sanctions, the company signed a deal with Saddam Hussein, Iraq's deposed president, in 1997 to develop the field. But in 2002, shortly before the US invasion, Baghdad rescinded the deal, saying it was angered by Lukoil's attempts to get assurances from the opposition that it would keep the contract in case Mr Hussein's regime fell. In the past two years Lukoil has spent $20m to train 1000-2000 Iraqi oil field engineers in Russian fields, put another 100 through Russian universities and provide equipment for Iraq's oil industry.
Vagit Alekperov, Lukoil's chief executive, said in an interview on Tuesday: "The Russian government supports us, the foreign ministry supports us, the president of the federation supports us. They support the idea of putting those Iraqi fields [into production] as soon as possible. In all these areas we have the support of the Russian government."
He added that Lukoil would be able to develop the West Qurna field two to three times more quickly than any other company. "We are ready to move really fast," he said. "The situation in South Iraq is pretty stable and we have no problem starting operations right after the passage of the hydrocarbon law and once we have the necessary approvals," he said. Iraq's parliament aims to pass the law by the end of next month.
West Qurna is believed to hold as many as 11bn-15bn barrels of recoverable oil reserves and has a potential to produce as many as 1m barrels a day, making it one of the world's biggest fields. International energy companies such as ExxonMobil, Royal Dutch Shell and BP have been waiting for the security situation in Iraq to improve before developing fields, and analysts believe the situation in the Shia-dominated region close to the southern port of Basra where West Qurna is located is far from predictable.
But at least one US company would benefit if Iraq's oil ministry assigned the development of West Qurna to Lukoil. In 2004 ConocoPhillips, the US's third largest energy group, formed a strategic partnership with Lukoil in which the US company gradually expanded its stake to just shy of 20 per cent. At the time of the announcement, the companies noted the eventually development of West Qurna as one of their motives for the deal.
Lukoil has spent more than a decade angling for West Qurna. In spite of United Nations sanctions, the company signed a deal with Saddam Hussein, Iraq's deposed president, in 1997 to develop the field. But in 2002, shortly before the US invasion, Baghdad rescinded the deal, saying it was angered by Lukoil's attempts to get assurances from the opposition that it would keep the contract in case Mr Hussein's regime fell. In the past two years Lukoil has spent $20m to train 1000-2000 Iraqi oil field engineers in Russian fields, put another 100 through Russian universities and provide equipment for Iraq's oil industry.
Labels: ConocoPhillips, Iraq Oil, LUKoil, Vagit Alekperov, West Qurna
Saturday, April 14, 2007
Russian oil company signs $4 billion contract with Iraq
Oil
(MENAFN) - A spokesperson at Russia-based LUK-Oil Company said that the company has signed a $4 billion contract with Iraq's Ministry of Foreign Affairs to develop oil fields in West Qurna, Iraq Directory reported. He added that the accord aims at assisting the company's projects abroad and to improve diplomatic ties. The Chairman of LUK-Oil said that the company is confident about the new deal with Iraq. The Iraqi Parliament still has to approve of the new law for oil which seeks to establish general work outline for foreign companies that invest in Iraq.
Labels: contract, LUKoil, Ministry of Foreign Affairs, West Qurna
Tuesday, April 10, 2007
Russian oil company enters into partnership with Ministry of Foreign Affairs
Oil, Business
(Iraq Directory) - LUK-Oil company, the largest oil producer in Russia, entered a partnership agreement with the Ministry of Foreign Affairs on Monday, and said that it depends on its support in preparing for the rehabilitation of a giant oil deal in Iraq. LUK-Oil and the ministry said in a statement that the agreement is the first of its kind in Russia, and it aims to support LUK-Oil projects abroad and defend the interests of the company through diplomatic means and facilitate meetings of the company abroad.
In its turn, LUK-Oil would consult with the ministry in energy-related issues. The Russian news agency Interfax reported that head of the company, Wajid Ali Kabeerov, said at the signing ceremony which foreign media journalists were prevented from from attending, "our company is entering new areas which do not enjoy political stability. We will need the support of the ministry in Iraq, particularly".
The head of the company said last month that his company is optimistic about the prospects for reviving a deal since the era of former Iraqi President Saddam Hussein to develop the giant Iraqi field of West Qurna after the government approved the new Iraqi oil law. The deal, worth four billion dollars, to develop the West Qurna field may face problems due to its cancellation by the government of Saddam just before his overthrown in 2003.
However, the new oil law still needs to be approved by the Iraqi Parliament, which aims to establish the general framework of the work of foreign companies that invest in Iraq after decades of sanctions in the era of Saddam and the years of violence since the invasion, led by the United States.
Labels: Ahdab oil field, LUKoil, Ministry of Foreign Affairs, Russia, Wajid Ali Kabeerov, West Qurna
Thursday, March 29, 2007
Foreign firms offer to develop Missan's oil fields
Oil
(Azzaman) - The authorities in the southern province of Missan say they have received several requests from foreign firms to develop the province’s gigantic oil fields. The officials refused to name the firms but said the relative stability which the province currently enjoys was luring both foreign and Iraq entrepreneurs to invest.
The province, which borders Iran, is among Iraq’s most impoverished with a rickety infrastructure. It was a battle scene in the eight years of Iraq-Iran war. “The provincial council has received offers from international and Arab firms to invest in the oil sector,” said Taha al-Dhaif, head of the Development Commission in the province. He said investors were also interested in developing the province’s tourist infrastructure and have made several offers to construct hotels and other tourist installations.
Some of the finest Iraqi marshes are situated in the province and the officials said the wetlands were flourishing once again and the authorities were considering ways to turn into tourist attractions. Dhaif said the council has an offer from a foreign firm to develop the massive West Gurna oil field, one of the largest unexplored oil fields in the country.
He said the council was keen to attract investors to help reduce the high unemployment rate and fight poverty. The province relies mainly on agricultural produce as its huge oil fields, with billions of barrels of proven oil reserves, remain undeveloped. Dhaif said the province was in need of power stations and it has already received an offer to construct one. There have been requests to construct housing apartments, and rehabilitate idle industries such as the prefab factory.
Iraq has the third largest proven oil reserves in the world behind Saudi Arabia and Iran. It is total proven reserves are estimated at 112 billion barrels, with as many as 220 billion barrels of resourced deemed probable. Of the country’s 74 discovered and evaluated oil fields, only 15 have been developed.
Some of the finest Iraqi marshes are situated in the province and the officials said the wetlands were flourishing once again and the authorities were considering ways to turn into tourist attractions. Dhaif said the council has an offer from a foreign firm to develop the massive West Gurna oil field, one of the largest unexplored oil fields in the country.
He said the council was keen to attract investors to help reduce the high unemployment rate and fight poverty. The province relies mainly on agricultural produce as its huge oil fields, with billions of barrels of proven oil reserves, remain undeveloped. Dhaif said the province was in need of power stations and it has already received an offer to construct one. There have been requests to construct housing apartments, and rehabilitate idle industries such as the prefab factory.
Iraq has the third largest proven oil reserves in the world behind Saudi Arabia and Iran. It is total proven reserves are estimated at 112 billion barrels, with as many as 220 billion barrels of resourced deemed probable. Of the country’s 74 discovered and evaluated oil fields, only 15 have been developed.
Labels: foreign firms, Maysan, Missan, oil fields, Taha al-Dhaif, West Qurna
Saturday, March 17, 2007
Oil minister says negotiations with foreign companies have not yet begun
Oil
(Iraq Directory) Iraqi Oil Minister, Hussein Shahrastani, said on Thursday that Iraq has not yet begun negotiations with the major international oil companies on the development of its energy sector; although, these companies are still waiting impatiently. Shahrastani said, "We are not negotiating with any major oil companies at the moment and we are awaiting the parliamentary approval to the new oil law which is likely to take place before the end of May".
The minister added that almost all international oil companies had interest in working in Iraq, "We have memorandums of understanding with almost each of these companies; they are preparing themselves, but there are no negotiations on the development of any particular field". The new law provides for the establishment of an Iraqi National Oil Company, which will be responsible for the main oil fields, the newly discovered and the productive. Major international oil companies are focusing on these fields such as West Qurna, Majnoon and Bin-Omar.
During the time of the late President Saddam Hussein, a consortium of Russian companies led by “LUKoil” signed an agreement to develop the West Qurna field, but Iraq canceled that agreement in 2002. Iraq is also reviewing an agreement to develop Al-Ahdab field signed with the Chinese National Petroleum Corporation and the Chinese company NORINCO for weapons manufacture. The French company Total, also, signed by initials some deals to develop the fields of Majnoon and Bin-Omar.
Labels: Bin-Omar, Hussain al-Shahrastani, Iraqi National Oil Company, LUKoil, Majnoon, NORINCO, Total, West Qurna
ConocoPhillips planning to develop oil field with LUKoil
Oil, Commerce
(BI-ME) - ConocoPhillips said this week it is talking with Iraq's Oil Ministry about possible projects, while continuing to work on plans to develop an Iraqi oil field in partnership with Russia's OAO Lukoil. Chairman and Chief Executive James Mulva said the US-based company is continuing to look at development plans for Iraq's West Qurna field with Lukoil, in which ConocoPhillips holds close to a 20% stake. Lukoil's West Qurna deal initially dates to the Saddam Hussein era, and Mulva said he hopes it is re-affirmed.
West Qurna is one of Iraq's largest oil fields, loacated North of Rumaila field, West of Basra. West Qurna is believed to hold 11 to 15 billion barrels of recoverable reserve and have production potential of 0.8 to 1.0 million barrel per day, equivalent to upwards of US$47 million per day or US$17.3 billion per year.
"We've also done a lot of study and training, working directly with employees and members of the ministry within Iraq to see what ConocoPhillips can do ourselves," he said in an interview after making a morning presentation to analysts in New York.
The company would require that several issues be resolved before it operates in the country, Mulva said. At the top of the list is a new petroleum law defining what role international oil companies would have in developing Iraq's resources. "We are waiting for the new petroleum law to be passed," Mulva said. "There's good progress in that regard, and hopefully it will be completed in time." When asked what he meant by "in time," Mulva said weeks to several months.
Passage of the law, Mulva said, will give the number three US oil company a clearer picture of what opportunities it can pursue within Iraq. Another requirement for ConocoPhillips, Mulva said, is improved security in Iraq. "For security reasons, we haven't had our employees in Iraq," Mulva said. The company would need positive assessments from the government and security firms for that to change, he said.
West Qurna is one of Iraq's largest oil fields, loacated North of Rumaila field, West of Basra. West Qurna is believed to hold 11 to 15 billion barrels of recoverable reserve and have production potential of 0.8 to 1.0 million barrel per day, equivalent to upwards of US$47 million per day or US$17.3 billion per year.
"We've also done a lot of study and training, working directly with employees and members of the ministry within Iraq to see what ConocoPhillips can do ourselves," he said in an interview after making a morning presentation to analysts in New York.
The company would require that several issues be resolved before it operates in the country, Mulva said. At the top of the list is a new petroleum law defining what role international oil companies would have in developing Iraq's resources. "We are waiting for the new petroleum law to be passed," Mulva said. "There's good progress in that regard, and hopefully it will be completed in time." When asked what he meant by "in time," Mulva said weeks to several months.
Passage of the law, Mulva said, will give the number three US oil company a clearer picture of what opportunities it can pursue within Iraq. Another requirement for ConocoPhillips, Mulva said, is improved security in Iraq. "For security reasons, we haven't had our employees in Iraq," Mulva said. The company would need positive assessments from the government and security firms for that to change, he said.
Labels: ConocoPhillips, James Mulva, LUKoil, West Qurna
