Thread: Archive Latest News - Think Tank - 16/08/07 - 03/11/07

Iraqi oil exports via Turkey will continue in case military operations started

A high-level Iraqi oil source said on Friday that Iraqi crude oil will continue to flow to the Turkish port of Ceyhan, in case Turkish military operations started targeting northern Iraq.

The source, who asked to remain anonymous, added that "the oil pumping is done through pipelines, not bound to boarders or to tankers and they are not affected by the military operations in case they occurred. We are continuing the pumping operations de****e media escalation between the Turkish and Iraqi sides."

The Turkish parliament's approval on the principle of launching an attack on the Kurdish rebels located in northern Iraq increased oil prices in the world markets.

The Iraqi official said that "Iraq exports oil to the world markets and not to a specific State."

International crises generally, the declining stocks of fuel, the concern about the interruption of Iraqi oil supplies to the world markets and the decline of the dollar's value are the main reasons behind the continued escalation of oil prices that exceeded today $ 90 per barrel, according to some media information.

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Setting up a new power station in Maysan

Businessmen Union in Maysan concluded a contract with an Indian company to establish a new power station with the capacity of 400 Mega Watt per second in the province.

Chairman of the Investment Committee in Maysan City Council, Taha Al-Dheif, said in a press statement that the Council endorsed this project, which will be implemented next year within the projects of developing regions and reconstruction projects and within a specified time limit by 12 months. Al-Dheif explained, "The Ministry of Electricity had previously agreed to set up an electricity station with the capacity of 250 Mega Watt per second, consisting of two generating units, the capacity of each one is 125 Mega Watt per second to meet the needs of the province and ease the load on the national electricity grid. It is noteworthy that cutting hours of the electricity power in Maysan reached more than 12 hours a day.

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A campaign to pave the streets in Hillah

The Directorate of Municipality in Hillah started a wide campaign to pave and develop the streets within the investment plan for the current year 2007 and the projects of the Supreme Reconstruction Council at the cost of more than 26 billion dinars.

A source at the Directorate said that 24 projects had been assigned for implementation under the investment plan for the current year at the cost of more than 17 billion dinars, pointing out that the projects include paving roads with the length of 31 km and develop a number of the city's entrances. The source said that one of the most important projects within this plan is paving the road of Hilla- Najaf with the length of more than 5 meters, developing the entrance of Hilla –Diwaniyah, 4 km in length, as well as paving main and subsidiary streets the neighborhoods of Al-Mukhabrat, Al-Bakrli, Al-Akrarmeen, Al-Karama and Al-Ubudia, explaining that it is scheduled to complete all these projects by the end of this year. He also mentioned that the Directorate assigned 5 projects for implementation within the projects of the Supreme Reconstruction Council at the cost of more than 9 billion dinars adding that the projects also include paving streets of different paper lengths in the neighborhoods of Al-Askari, Mustafa Raghib, Street 60, Al-Thoura and Maheisim. It should be noted that the Directorate of Municipal in Hillah completed the work of burial and settlement of a number of the streets of the city as well as raising large amounts of garbage within the projects of the investment plan for the current year 2007.

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Sorry if already posted.

Talabani refers to "direct contacts" between Iraq and Total Company

Iraqi President, Jalal Talabani, referred during a visit to Paris to a "direct contacts" between the Iraqi authorities and the French oil group Total.

Talabani said "with regard to oil and economic relations, there is some progress and there are direct contacts between the Iraqi Ministry of Oil and Total."

French Foreign Minister, Bernard Kouchner, only said that Total, which had a large presence in Iraq previously, had "very old" contacts and relations in this country.

He said, "We hope that companies, not only oil ones, would resume and intensify activities with Iraq, but we draw attention to the security conditions," referring to the atmosphere of violence and kidnapping of foreigners in Iraq.

The Director-General of the Group Total, Christophe de Margery, announced on the 10th of October, "We keep our contacts (in Iraq ) to push things forward." But he added that Total did not start projects in this country because "there is a fundamental problem which is the absence of security."

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Completing Nasiriyah large water project

In Dhi Qar, technical and engineering cadres completed the work on Nasiriyah large water project, within the program of reconstructing and developing regions; its is one of the great projects of strategic task that feeds five cities in the north and south of the province.

In terms of achievements, the Directorate of Roads and Bridges in Maysan governorate completed a number of projects concerning roads and bridges within the districts and centers of the province.

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13 States participating in the Fair of Reconstructing Iraq

Kuwaiti International Fair Company said that it continues its preparations for the exhibition of reconstructing Iraq for 2007 from 3 to 6 next November, which will be sponsored by His Highness the Crown Prince Sheikh Nawaf Al-Ahmad on the ground of the international exhibitions in Mashrif.

Chairman of Kuwait International Fair Company, Ali Mubarak Al-Shatti, said that the exhibition attracted the participation of more than 13 Arab and foreign countries and they are: Egypt, Syria, Iran, Turkey, Sweden, Australia, Malaysia, China, Britain and Taiwan as well as the participating companies from the State of Kuwait.

The procedural arrangements with the Iraqi industrial and commercial chambers are under way to arrange the arrival of Iraqi visitors throughout the Fair.

AlShatti added that Kuwait International Fair Company called most of the Gulf States and Arab countries to participate in the exhibition, "which is one of the demonstrations to help Iraqi people overcome the grief after the fall of the previous Iraqi regime, and many nations hastened to confirm their participation in the exhibition."

He noted that the second round of Iraq reconstruction exhibition comes to invest the substantial successes achieved by the first exhibition 3 years ago.

He said observers believe that the State of Kuwait is the best place to host an exhibition for the reconstruction of Iraq, as Kuwait is a safe gateway for entering the country of Iraq and because of the geographical proximity between the two countries; it is a key element for the success of deals that were made for the introduction of construction materials and supplies to the reconstruction of Iraq.

The first session of Iraq reconstruction exhibition attracted about 140 companies came from different parts of the world where reviewed all the requirements of construction and reconstruction needed by the country of Iraq.

Al-Shatti said that Kuwait International Fair Company succeeded in mobilizing a greater number of companies and official bodies and the countries that can contribute directly in the reconstruction operations in Iraq or provide institutions and corporations with the necessary equipments for the reconstruction operations to restore Iraq to the International hangar in its normal circumstances.

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Crude Oil Falls for a Third Day on Signs U.S. Inventories Rose

Crude oil fell for a third day on forecasts that a government report tomorrow will show U.S. oil and gasoline inventories rose.

Crude-oil stockpiles climbed 1.13 million barrels last week, according to the median of 15 responses in a Bloomberg News survey. Gasoline inventories rose 700,000 barrels, the survey showed. Analysts were split over whether supplies of distillate fuel, which includes heating oil and diesel, rose or declined.

``Crude oil supplies are really comfortable,'' said Tim Evans, an analyst with Citigroup Global Markets Inc. in New York. ``A build in gasoline and a little-changed distillate number will certainly be bearish.''

Crude oil for December delivery fell 77 cents, or 0.91 percent, to $85.25 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Oil is up 45 percent from a year ago.

On Oct. 15, prices passed the previous all-time inflation- adjusted record reached in 1981 when Iran cut oil exports. The cost of oil used by U.S. refiners averaged $37.48 a barrel in March 1981, according to the Energy Department, or $84.73 in today's dollars.

``It's unclear whether the decline of the last two days was the start of a bearish market or a bit of consolidation before another push toward $90,'' said Tom Bentz, a broker at BNP Paribas in New York.

Oil reached a record $90.07 a barrel in New York on Oct. 19 after the dollar fell against the euro and Turkish lawmakers voted to allow military strikes in Iraq against Kurdish militants. Iraq holds the world's third-largest reserves of oil.

``There are a lot of investors focused on the siren call of $100,'' said Peter Beutel, president of Cameron Hanover Inc., a New Canaan, Connecticut, energy consultant.

Brent crude oil for December settlement fell 55 cents, or 0.7 percent, to $82.72 a barrel on the London-based ICE Futures Europe exchange.

Bloomberg.com: Energy

PWR-KWAIT-IRAQ-OIL

Iraq seeks to use oil to strengthen ties, not launch wars -- official By Riham Al-Shaheen KUWAIT, Oct 23 (KUNA) -- Iraq seeks to use oil to strengthen its relations with its neighbors not to launch wars as its former regime did, an Iraqi official said here Tuesday.

Spokesman and Media Director of the Iraqi Oil Ministry Asim Jihad, participating in the World Energy and Chemicals Exhibition and Conference held here, told KUNA his country is looking forward to activating its joint oil fields with Kuwait and to form committees responsible for joint investments.

Through participating in the exhibition, Iraq aims to reinforce its relations with Arab states including its immediate neighbors, to benefit from their expertise, and cooperate with them in drilling and extracting oil, training oil manpower, and establishing refineries, he said.

The Iraqi Oil Ministry is also keen on taking part in such events to present its new oil policies that are aimed to developing the oil industry in Iraq, especially after it suffered a lot for many decades due to the carelessness of the former regime, he added.

As a result of that carelessness, Iraqi oil facilities have become very basic compared with the rapid development of technology in the oil and gas fields, he pointed out.

On the Turkish conflict with rebels in northern Iraq, Jihad said his country refuses any threat to its oil facilities and oil pipelines.

He said any attack on the oil pipelines would affect the Iraqi people negatively, as the country's economy is mainly dependent on oil exports.
He accused "the enemies of the new Iraq" of planning to stop the export of Iraqi oil through launching attacks on oil facilities, causing losses of billions of US dollars.

On future plans, the Iraqi official said his country aims to export 500,000 barrels of oil daily through a Turkish port, saying that will benefit Iraq's budget.

He stressed that all Iraqis, regardless of their status or ethnic origins, are responsible for protecting their country's oil.

http://www.kuna.net.kw/NewsAgenciesP...55&Language=en

Gunmen clash with security forces in Iraq's Basra

Leaders of political parties in Basra, Iraq's southern oil hub, held urgent talks today to calm tensions in the volatile city after gunmen clashed with Iraqi security forces, the British military said.

Details of the fighting were sketchy, but British military spokesman Major Jamie Halford-Macleod said shots had been fired at the Shatt-al-Arab Hotel, headquarters of the Iraqi security forces, in the north of Iraq's second city.

Halford-Macleod said gunmen had also opened fire on the provincial joint coordination centre, which British forces pulled out of in late August as part of their withdrawal from the city centre to their main base on the outskirts of Basra.

The riverside city of more than 1 million people is strategically vital as the hub of southern oil fields that produce nearly all of the government's revenue and is the centre for imports and exports through the Gulf.

It has witnessed a turf war between rival Shi'ite groups, including supporters of cleric Moqtada al-Sadr, the powerful Supreme Iraqi Islamic Council and smaller Fadhila party, which controls the governorate.

Halford-Macleod said Major-General Mohan al-Firaiji, commander of Iraqi security operations in Basra, was meeting leaders of political parties. Violence appeared to have subsided.

''We maintain overall responsibility for Basra province and will respond as deemed necessary. Certainly there is no request from General Mohan for any assistance from us,'' he said.

British forces are keeping a lower profile in Basra since they pulled out in September in what was seen as an important test of the Iraqi security forces' ability to prevent the city becoming a battleground for competing Shi'ite factions.

British Prime Minister Gordon Brown said earlier this month that British forces in Iraq would be halved to 2,500 from spring next year.

Analysts fear that as British troops withdraw, the rival Shi'ite factions will intensify their battle for political supremacy, possibly drawing in neighbouring Iran.

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Analysis: Turkey-Iraq fight won't harm oil

As Turkey’s military bares its teeth across the border with Iraq, oil prices sit comfortably above the $80-per-barrel mark. Any incursion will likely not affect the work of Iraq’s oil sector today but could stifle investment, especially in the KRG, and put Turkey’s oil sector -- a vital transit route for the world’s oil supply -- at risk.

“It looks like the institutional investors are looking for almost any event to emphasize with people who may not be as familiar with Middle East geography or politics as they ought to be to help push up the price of oil,” said Bulent Aliriza, an energy expert and director of the Center for Strategic & International Studies’ Turkey Project.

Oil raced to the $90-per-barrel mark last week and is starting this week off the same way.

Aliriza said any Turkish incursion would not create a new war zone around Iraq’s oil fields or pipelines.

The Kurdistan Workers’ Party, or PKK, which Ankara says is using bases in northern Iraq mountains to plan and carry out attacks in Turkey, is threatening to respond to the Turkish military by targeting Turkish pipelines.

Attacks by the PKK over the weekend have put more pressure on Ankara to act. The PKK uses violence to forward the Kurdish autonomy agenda and is recognized by Turkey and the United States as a terrorist organization. The group ambushed Turkish troops Sunday, killing 17, wounding 16 and taking eight hostages.

The United States and the European Commission have issued tempered statements supporting Turkey. Last week Turkey’s Parliament approved cross-border action to route the PKK from the northern Iraqi mountains where at least 3,000 are based. Turkey’s leaders claim the right to hunt the PKK but say it is in the planning stages while other solutions work their course.

The KRG, as well as the Iraqi and U.S. governments are urging restraint, while Turkey claims the three aren’t doing enough to put an end to the PKK.

“The politics of the situation are pretty extreme right now,” said Paul Sullivan, an Iraq expert and economics professor at the National Defense University.

“The Turks are the number one investor in oil development in the north of Iraq now,” he said. “There are a lot of contradictions here. They are also the most important investor in just about every industry in the north right now.”

Turkey, Iran, Syria and Iraq all have a sizeable Kurdish population but are wary of any moves toward an independent Kurdistan.

The fate of Iraq’s northern oil, both in and outside the KRG territory, is in the hands of Turkey’s military planners. The Kurds fear, but experts doubt, the Turkish incursion would go beyond the Qandil Mountain area.

Sullivan said a “short-term incursion” would not affect oil production. The closest pipeline -- which flows to a port in Turkey and is regularly hit with Sunni insurgent attacks -- barely runs through the KRG area, just before it enters Turkey, and the oil fields and active exploration are not near the border.

“It will certainly affect potential investment in the sector,” he said, “and there’s a great deal more that could be done in that part of Iraq for oil development.”

Less than a quarter of Iraq’s proven reserves -- the third largest in the world -- are located in northern Iraq, and most of that is outside the KRG area. But the country is massively underexplored, and experts say Iraq’s reserves could be double what have been found so far.

There are potential consequences for Turkey, as well, if it enters Iraq, including any effect the blowout would have on its relationship with Washington. No one wins if Iraqi Kurdistan turns to violence and unrest, including current and future investors.

Turkey is already a major transit hub of oil flow to the world, as well as a growing consumer, with many more projects in the works or on the drawing board.

The new BTC pipeline -- from Baku, Azerbaijan, through Tbilisi, Georgia, to Ceyhan, Turkey -- is expected to see 1.2 million bpd flow through it next year, and the PKK says it will bomb it in retaliation.

“If (the PKK is) getting bombed and their people are getting killed the BTC is an economic lifeline for southeastern Turkey, including transport fees and also including the oil that Turkey takes out of the pipeline,” Sullivan said. “And surely if it gets real nasty the BTC is at threat.”

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