Thread: Archive News - Iraqi Dinar Think Tank - 24/01/201 - 23/07/2011

Helping Your Countrymen Succeed in Iraq
Iraq is projected to grow faster than China

US Secretary of State, Hillary Rodham Clinton, didn’t mince her words:

“According to the IMF, Iraq is projected to grow faster than China in the next two years. Now, let me repeat that, because when I read it I said, okay, are you sure because we always think of China as being the juggernaut? But no, indeed, Iraq is projected to grow faster than China … Iraq has one of the largest customer bases in the entire Arab world. It has one of the world’s largest supplies of oil, and it has one of the best educated workforces in the region.“

While not shying away from the fact that Iraq “remains a tough environment“, the Secretary went on to urge businesses in Iraq to hire more women, and to encourage American firms to enter the country.

Iraq’s future clearly depends on the expertise and capital that foreign companies can bring, and there is plenty of business there for all nationalities.

http://www.iraq-businessnews.com/201...eed-in-iraq-2/

Economic Adviser: Oil prices will not drop to $ 100 in the coming months

The economic adviser in the Iraqi government that Iraqi oil prices will not drop to less than $ 100 per barrel in the coming months because of the needs of international companies to large quantities of oil found after the export from Libya.

Salam al-Quraishi, a Kurdish news agency (Rn) that "the Iraqi crude oil prices will not fall below $ 100 a barrel, especially with the polarization of the Asian markets to buy Iraqi oil."

"The state budget for 2011 is built on the basis of the sale price level of crude oil up to $ 85 per barrel, which would cause a large surplus of money in the state budget."

He pointed out that "Iraq is seeking to raise the level of exports of crude oil during the next phase in order to mature the economic reality in the country and deal with service projects with Tabaah strategic and in need of additional funds to speed up the completion."

http://www.aknews.com/ar/aknews/2/246764/

Exiled TBI Boss Denies Allegations – Open Letter from Bank’s Advisor

The exiled former head of the Trade Bank of Iraq (TBI), Hussein Al-Uzri [Hussein al-Azri], has denied allegations of corruption and mis-management in a telephone interview with Reuters.

“It’s about control of this bank,” the U.S.-educated banker, aged 48, told the news agency in his first media interview since fleeing Iraq. “Having control of the bank gives them control of substantial assets and they can basically utilize it.”

For his own security, he did not want to say from which country he was speaking. A top Maliki aide, cabinet general secretary Ali al-Alaq, has said authorities moved against the bank because its leadership was suspected of violating banking regulations and issuing improperly secured loans. Alaq said the irregular practices had cost the country “millions of dollars.”

But Sir Claude Hankes, a British adviser to TBI’s board, has written an open letter to Iraqi President Jalal Talabani saying that the charges are simply a political ploy to give Prime Minister Nouri Al-Malik control of the bank.

The full text of Sir Claude’s letter follows:

Mr. Talabani and Members of Parliament of Iraq; I am the Independent Advisor to the Board of the Trade Bank of Iraq (TBI).

You are no doubt aware of the great contribution TBI has made to the people of Iraq. It is the one Iraq institution that has demonstrated to the world at large that Iraq is a country of the future. TBI is respected by international banks as is evidenced by the list of TBI’s correspondent banks: JP Morgan, Deutsche Bank, Citi Bank to name but a few.

It has been voted ‘The Best Trade Bank in the Middle East’ for several years. Its results for 2010 are outstanding. The accounts were audited by PWC, one of the most respected international audit firms, and the accounts were unqualified. This is due to the outstanding leadership of Mr. Hussein Al Uzri. Mr. Al Uzri is the most respected banker in Iraq.

TBI’s great strength has been its outstanding staff and those that Mr. Al Uzri had persuaded to join the bank with international experience. TBI has grown from a capital of 95 million to a bank with a capital of 1 billion from retained earnings.

Mr. Al Uzri deserves the highest Iraq honour for his hard work, dedication and commitment and success. The Iraqi people know this, you know this.

Mr. Al Uzri’s high profile and the banks success resulted in Mr. Al Uzri twice narrowly escaping death due to bomb attacks on his life and that of the bank when I was in Baghdad.

Mr. Al Uzri continued heroically in his post and TBI went from strength to strength. You are fully aware that because of TBI Erbil has the benefit of 24 hours of electricity. There is no excuse that the whole of Iraq does not have this basic requirement. This, to a great degree, is through gross incompetence by those responsible in Government.

TBI’s success has been that it has been run independently and professionally by those with the appropriate international experience combined with the hardworking staff in Baghdad. Unique in Iraq.

The Iraq economy cannot develop without a sound financial system and without it political instability will increase. You are aware that The Iraqi people’s patience is running out and rightly so. The corruption in successive Iraq governments has been an insult to The Iraqi people. There was a short period when this was not the case, you know that it can and should be stopped and was for a short period. It requires people of independence, with integrity, and competence. There are many Iraqis who possess these qualities but few have been asked to serve or been persuaded to do so at this time.

The action by Mr. Maliki to undermine the standing and credibility of TBI, the success story of Iraq, is the most damning example of political corruption. The Iraqi people will not stand for this. I urge you to form an internationally respected committee to investigate the actions of the Prime Minister and his office in this respect.

It is my position that the charges against Mr. Al Uzri would not stand up in any international court and should Mr. Al Uzri decide to seek significant damages in an international court the Iraq government will have to prove the accusations in an international court.

If somebody like Mr. Ali Allawi were to be asked to chair such a committee and he were prepared to accept, this would demonstrate that the committee would be independent and professional. It should include two independent international auditors and two internationally respected lawyers. I would be very surprised if such an investigation did not establish beyond any doubt whatsoever that the actions by Mr. Maliki and the charges brought against Mr. Al Uzri were unlawful, unfounded and an attempt to divert attention from serious corruption in various ministries.

To replace the key executives in the bank with those on the unconstitutional committee set up in the Prime Minister’s Office and others (at this present time 11 individuals) from Rafidain Bank will destroy the reputation of TBI and Iraq. The General Manager appointed and others are from the bank that was responsible for at Rafidain for losing close to $300 million. They do not have appropriate experience and they themselves should be under serious investigation for what happened in Rafidain. There are two other Iraqi banks which cannot pay depositors. They are the Warka Bank and the Basra Bank.

By removing Mr. Al Uzri and his outstanding team, the bank has lost its independence and is under the direct control of Mr. Maliki and this is what he sought to achieve. Mr. Maliki personally signed contracts in Korea for billions of dollars for the supply of turbines at a price that raises serious questions and without any bidding process and bypassing the approved Iraqi Budget. Mr. Maliki insisted that TBI provided confirmed LCs when there was no basis for this in the agreement. The bank refused as it would have put at risk the future of the bank. Mr. Maliki furthermore signed an agreement with Hanwa in Korea for close to $7 billion, again with no bidding process. Attempting financing through TBI and illegally bypassing the approved Iraqi Budget.

I estimate that the Ministry of Trade has a deficit of over $2 billion and not withstanding over 300 written requests from the Iraq Board of Supreme Audit for information on the use of these funds, The Ministry of Trade has refused to provide any information.

I understand from members of Parliament that this matter is being investigated by a special committee set up by Parliament. This refusal to provide information, under the direct orders of the Prime Minister, demonstrates the serious corruption in the Maliki government and a total disregard for law and Parliament.

There are many other examples where the Maliki government has tried to force TBI to provide financing in totally inappropriate ways, which would have damaged the standing of TBI and the standing of Iraq in the international financial community. Mr. Maliki has furthermore tried to remove and control the governor of the Central Bank, who has also refused to do so.

The US Government, which was key in ensuring the second term of Mr. Maliki as Prime Minister, cannot deny that they are aware of many of these facts.

Mr. Talabani, Members of Parliament, unless immediate action is taken and the independence of TBI is restored, the Iraqi people will pay the penalty. I therefore urge you to deal with this matter before it is too late.

http://www.iraq-businessnews.com/201...banks-advisor/

U.S. Companies Get Slice of Iraq's Oil Pie

When Iraq divided up its oil pie two years ago, the Russian company Lukoil won a slice equivalent to about 10 percent of Iraq’s known reserves. It was part of a trend: Five of the six major fields, together representing several million barrels per day of potential output, went to European, Russian and Asian oil companies. It looked as though not much was going to companies from the United States, the country that took the leading role in the war.

But read the fine print of those contracts, and companies more familiar to Americans are now poised to benefit handsomely as the oil business picks up in Iraq.

The oil services companies Halliburton, Baker Hughes, Weatherford International and Schlumberger already won lucrative drilling subcontracts and are likely to bid on many more in one of the world’s richest markets for companies that drill oil wells. These days, that is not the oil majors.

Halliburton and Baker Hughes are American, while Schlumberger is based in Paris though its drilling subdivision is headquartered in Houston. Weatherford, though founded in Texas, is now incorporated in Switzerland. “Iraq is a huge opportunity for contractors,” Alex Munton, a Middle East analyst for Wood Mackenzie, a research and consulting firm based in Edinburgh, said by telephone. “There will be an enormous scale of investment.”

Mr. Munton estimated roughly half of the expected $150 billion the international majors will spend in capital outlays at Iraqi oil fields over the next decade will go to drilling subcontractors, most of them American.

Halliburton has won drilling and well refurbishment contracts at three of the six major fields, Weatherford International, Schlumberger and Baker Hughes at two others. One Chinese oil-services company is also working on these projects, as is a domestic Iraqi subcontractor, the Iraq Drilling Co.

Iraq signed the production contracts with international oil companies with the goal of increasing its oil output from about 2.4 million barrels a day in 2009 to as much as 12 million barrels a day within six years. So far, output has risen to 2.7 million barrels of oil per day.

Experts have dismissed the initial Iraqi target as unrealistically optimistic; last week, Iraq’s oil minister said it could be revised down to between seven and eight million barrels per day. Still, even the smaller increase from Iraq in coming years could ease global supplies and provide the Iraqi government with much needed funds for reconstruction.

The awarding of this vast new oil frontier to mostly non-American oil majors deflected criticism that the United States had invaded Iraq for its oil. The one major U.S. contract went to ExxonMobil, for refurbishing the West Qurna 1 field.

The Russian oil concession in Iraq shows how geopolitics shaped the awarding of the primary contracts but is not preventing U.S. oil services companies from winning business today, helping their profits and stock prices.

Lukoil struggled to hold onto its Saddam Hussein-era contract in a sprawling, geopolitical chess game over a decade. It wrapped in U.S. oil companies, the Russian government, and threats by Moscow to cancel post-War Iraqi debt relief if the Iraqis followed U.S. advice and stripped Lukoil of its license.

But when Lukoil finally secured rights to the field by re-bidding for it, the company quickly subcontracted the drilling. A U.S. oil-services company, which Lukoil executives said they could not specify to comply with securities legislation, won the first contract for three exploration wells.

The more sweeping drilling tendering for this field, called West Qurna 2, is just getting under way now. Under its contract, Lukoil committed to produce 1.8 million barrels of oil per day from the field by 2017; it was unclear whether that would be revised along with the broader revision of output targets under way in Iraq now

In any case, Lukoil says it will need to drill more than 500 wells to develop the deposit, which is underneath agricultural, scrub and dry clay land west of the Euphrates River in the southern Basra province. Along with the contract already granted, Lukoil has tendered for 23 production wells, and plans another tender this year for another 50 or so. Analysts estimate drilling an oil well in Iraq costs between $10 and $20 million.

Mr. Munton of Wood Mackenzie said U.S. oil-services companies were poised to win much of the drilling work at West Qurna, as at other Iraqi fields, though other capital outlays such as for processing facilities and pipelines would go to a more international cast.

Joost R. Hiltermann, deputy program director for the Middle East and North Africa with the International Crisis Group, which is monitoring the security implications of Iraq’s oil policies, said Iraqi officials are unlikely to try to diversify away from U.S. companies at the less politically sensitive subcontracting level.

“The strategic interest of the United States is in new oil supplies arriving on the world market, to lower prices,” Andrei Kuzyaev, the president of Lukoil Overseas, the foreign subsidiary of the Russian giant, said in an interview.

Mr. Kuzyaev said Lukoil will manage this contracting transparently, offering no preference to Russian oil-services companies. Under contract provisions, these tenders must be competitive, he said. “Whoever offers the lowest price will be the winner,” he said.

“It is not important that we did not take part in the coalition. For America, the important thing is open access to reserves. And that is what is happening in Iraq.”

U.S. oil-services companies are well positioned to win the work because they have been in Iraq for years on contract with the U.S. occupation authorities and military. Rather than scaling back as the U.S. military pulls out, Halliburton is planning to expand.

The company has 600 employees in Iraq today and said in a statement it intends to hire “several hundred” more before the end of the year.

“We continue to win significant contracts in Iraq, and are investing heavily in our infrastructure,” Halliburton said.

http://www.nytimes.com/2011/06/15/bu...1&pagewanted=2

Finance Committee: the end of June will be the date for calculating oil savings

Announced that the Finance Committee in the Iraqi Council of Representatives that the end of June will be the date for calculating oil savings achieved over the last six months of this year.

A member of the Committee Faleh is valid in a statement to the Agency by news Monday that the rise in world oil prices, which amounted to about $ 100 per barrel during the past six months, was born and savings of Iraq will be calculated as the end of June, confirming the existence of programs can not exchange them through those savings add to those developed in the budget.

He said the rate of 20 percent of these savings will be utilized for small, create jobs for the unemployed.

http://ar.radionawa.com/Detail.aspx?id=8086&LinkID=197

Bremer, the central bank carries responsibility for the loss of $ 6.6 billion of Iraqi funds

The Vice Governor of Central Bank of Iraq Coalition Provisional Authority head Paul Bremer, the responsibility of the loss of $ 6.6 billion U.S. dollars.

He denied the Alabreha told all of Iraq on Wednesday that the central bank is responsible for the loss of U.S. $ 6.6 billion lost in the period between 28/5/2004 and 28/6/2004 AD.

He said the central bank in case of that period if all the institutions of the state was subject to the CPA and Bremer is the civilian governor of Iraq in that period.

He Alabreha The Central Bank of Iraq did not have money of its own base of this size. Zkrnaúb and Central Bank Governor that the funds in that period belongs to the Iraqi government, which was run by the then civil governor Paul Bremer.

http://ar.radionawa.com/Detail.aspx?id=8340&LinkID=197

Iraq submitted a plan to the Security Council to manage the funds of the Development Fund

Iraq informed the Security Council to complete its procedures in post-development fund at the end of this month. The Fund was established in 2003 based on UN Resolution 1483 and holds the proceeds of oil export sales and the remaining balances of the oil for food.

And the Ministry of Foreign Affairs of the Security Council that «Baghdad has made ​​all the arrangements required to ensure that the allocation of five percent of oil revenues to the Compensation Fund».

Iraq has suffered from the burden of $ 21 billion out of 41.3 obtained in compensation for its invasion of Kuwait in August 1990.

The plan of the government «open a new account on behalf of the Government of the country's management of the Iraqi Central Bank with the Federal Reserve (the U.S. central bank) as an alternative to the expense of the Development Fund for Iraq, turned to him all the financial assets owned by the Development Fund for Iraq is in addition to any other assets belonging to the Iraqi government" .

The Iraqi government spokesman Ali al-Dabbagh, announced the end of last April's approval of the Council of Ministers to a government report on the transition to the arrangements after the Development Fund for Iraq on the basis of Security Council resolution 1956 to 2010. She drew a letter to the Iraqi Foreign Ministry that «the mechanism will ensure the continuation of Iraq with its obligations under the resolutions of the United Nations."

Presented to the Development Fund for Iraq and the media considered the largest theft in U.S. history. According to press reports that Congress had allocated about $ 61 billion for the reconstruction of Iraq after the U.S. invasion in March 2003, but the statistics of the reviewers pointed out that the $ 6.6 billion of that amount was stolen or disappeared, most likely."

The plan included the Iraqi «solutions to the Iraqi Committee of Financial Experts replace the International Advisory and Monitoring from the beginning of next month."

The Security Council decided last August to stop working arrangements for depositing of proceeds from sales of oil and gas in the Development Fund for Iraq, and called on Baghdad to complete the full transition and effective mechanism after the Fund, including the arrangements for the observers to finance external and continue to pay five percent of the victims of the Iraqi invasion of Kuwait.

President Barack Obama decided to extend U.S. protection to the Development Fund in Iraq for one year.

http://translate.google.com/translat...p%3Fid%3D22578

U.S. pullout exposes Iraq's oil industry

U.S. helicopter gunships fired at raiders near Basra, Iraq's second city and strategic oil center in the south, underlining fears that the vital Iraqi oil industry will become a target again as U.S. forces withdraw.

The attackers fired seven rockets at Basra's airport but the wider threat has taken on greater significance as the Baghdad government and Washington debate the political risks of keeping on as many as 20,000 U.S. troops past the Dec. 31 deadline for completing the withdrawal.

A few hours before the Basra violence, the governor of the disputed oil province of Kirkuk in the north called for the pullout to be postponed.

"The security situation will collapse in Iraq if the U.S. forces withdraw now," warned Gov. Nejmeddine Karim, a Kurd who is also head of Kirkuk's security committee.

Although fighting in Iraq has fallen since the large-scale bloodletting of 2006-07, the level of violence has been creeping up again as U.S. forces have withdrawn over the last 18 months. Some 40,000 remain.

On June 5, a storage facility in the Zubair oil field operated by Eni, Occidental Petroleum of the United States and South Korea's Kogas, was bombed, underlining the complex task Iraq faces of building up its energy infrastructure.

The storage farm is linked to the oil loading terminal at Al Fao in the northern Persian Gulf, one of the main export facilities for Iraq's southern oil fields which contain two-thirds of its proven reserves of 144 billion barrels.

Zubair and other oil facilities in the south would be highly vulnerable to attack by Shiite militants of the Mehdi Army, the Iranian-backed militia of firebrand cleric Moqtada Sadr. He was vowed to attack Americans if they stay on in Iraq past the withdrawal deadline.

In other recent attacks on Iraq's oil infrastructure, al-Qaida insurgents bombed the country's largest refinery at Beji, 110 miles north of Baghdad, Feb. 25, killing four workers and causing a major fire.

The refinery, which produces around 150,000 barrels a day of petroleum products, was forced to shut down.

It was the second attack in a month. Beji was knocked out for several weeks by a series of bombings in January 2008.

On Feb. 10, pipelines into the Dora refinery in Baghdad were bombed, disrupting production.

In March, the main oil pipeline from Kirkuk, a region that contains one-third of Iraq's reserves, to Turkey's Ceyhan terminal in the eastern Mediterranean was attacked, cutting off exports for several days.

Since 2003 the Ceyhan pipelines have been attacked hundreds of times.
The concerns about the oil industry, which generates 90 percent of the Baghdad's government's revenues, could not have come at a worse time.

Iraq has boosted its oil production to the highest level in a decade and has embarked on a $50 billion program to upgrade and expand its oil facilities, while seeking to harness its vast natural gas reserves, worth billions of dollars, which have never been developed.

But the government of Prime Minister Nouri al-Maliki is having to slash its ambitious plan to increase oil production five-fold to 12 million barrels per day by 2017 and challenge Saudi Arabia as the world's top producer.

Oil industry analysts have long warned that the plan to boost oil production to levels never seen in Iraq was too ambitious for the antiquated and ineffective infrastructure available.

A serious collapse in security could be potentially devastating for the oil industry.

"Few, if any, forecaster even outside the energy industry, had really planned for Iraq to come anywhere near its 12 million bpd production target," observed Middle East analyst Samuel Ciszuk of IHS Global, a London energy consultancy.

In recent weeks, the Iraqis have found that reality bites. Oil Minister Abdel-Kareem Luaibi says his department is drawing up a new plan with lower production targets and a longer timeframe, 13-14 years rather than the 6-7 originally envisaged.

"We're studying several scenarios for more economic production rates," he said during the June 8 OPEC meeting in Vienna.

"Instead of producing 12 million bpd for seven years, we can produce 8 million bpd for 13 to 14 years," he said.

Iraq's oil output hit 2.68 million bpd in April, an increase of 15 percent since November 2010, the International Energy Agency said.

http://www.upi.com/Business_News/Ene...0021308333952/

Maliki calls for parliamentary integrity and financial disclosure mechanism for disbursement of oil abundance

demanded that the Iraqi parliamentary integrity committee, on Saturday, Prime Minister Nuri al-Maliki and Minister of Finance made a statement disbursement aspects of oil windfall "divide the price of oil" for years.

A member of the high-Nassif, in a statement received by the Kurdish news agency (Rn), a copy of it, that "the Prime Minister and Minister of Finance Bayan exchange mechanism abundance of oil, and the statement of final accounts for the period of the last to be presented to the House of Representatives."

Nassif explained that "the right of members of the House as representatives of the people to see what was spent during the Hundred Days of the abundance of oil is recycled from the final accounts."

And stated that "transparency must be a central feature of financial transactions for all ministries, the Ministry of Finance should be on top of the list of ministries, which provide detailed tables on the mechanism of exchange, whether during the last hundred days or the first half of this year."

The Iraqi government has revealed that high oil prices boosted Iraq's oil revenues to reach $ 34.1 billion in the first five months of this year, an increase of $ 8.7 billion or 34 percent from the budget figures.

With the steady rise in Iraqi oil production and exports, government officials say they expect to cover the expected shortfall in oil revenues in the 2011 budget of $ 13.4 billion.

In February, the Iraqi parliament approved a budget of 82.6 billion dollars in 2011 on the basis that the price of oil is $ 76.50 per barrel of crude and exports 2.2 million barrels a day.

http://www.aknews.com/ar/aknews/2/247093/

Legal Advisor: Oil formula did not send the new contract with Shell

The legal adviser to the Iraqi government on Saturday that the oil ministry did not send a copy of a modified version of the contract between them and Shell, adding that the current version, which many legal problems.

Announced that the Iraqi Oil Ministry will sign a final contract it with Shell to develop the gas fields, affirming that she commissioned a cadre of legal access to the final version of the contract with the company during the month of June,.

The company has demanded that Shell Oil Ministry signed a final contract after the initial contract was concluded in 2008

Fadel said Mohammed Jawad told the Kurdish news agency (Rn) that "The oil ministry did not send form new contract with Shell to the Secretariat after it refused to format the old contract between the Ministry of Oil and Shell because of legal problems, which require extensive amendments and sent to the Secretariat of the Council of Ministers ".

He added that "the Iraqi government instructed the Ministry of Oil in the non-conclusion of the contract unless the current formula to solve some legal problems which may harm the political in the oil of Iraq."

He continued that "the General Secretariat of the Presidency of the Council of Ministers Awaiting amended version of the contract with Shell to study and speed up the signing of the contract."

The Oil Ministry announced that Iraqi and Iraq's imports for the month of May last reaching its highest level since reaching more than seven billion and $ 450 million, and reached Iraq's exports to 2,000,225 barrels of oil per day of Iraqi crude.

Iraq says that 60% of its crude oil exports to Asian markets, the global favored by the U.S. imposed on him with money transfer system "transit."

http://www.aknews.com/ar/aknews/2/247130/