Thread: Archive Latest News - Think Tank - 01/01/08 - 14/04/08

Anti-Maliki bloc against Kurd oil deals

Iraqi political factions upset with current leadership have pledged to support the central government in oil deals, an apparent knock to the Kurds.

The pledge comes from a meeting between representatives of former Prime Minister Ayad Allawi's supporters, the Sadr Movement, the Fadhila Party and a disaffected part of the Dawa Party.

Dawa, the Islamic Supreme Council of Iraq and the Kurdish Coalition make up the ruling government coalition in Baghdad's weakening central government.

IraqSlogger.com, translating an Arabic story in the newspaper Azzaman, says the parties are opposed to Prime Minister Nouri al-Maliki's government and will "support the position of the central government regarding its exclusive right to explore oil fields and sign contracts with foreign companies."

Despite being coalition partners, the Kurds have riled the federal oil minister by moving forward unilaterally on developing their oil sector.

The Kurdistan Regional Government, which controls three northern provinces, has passed its own regional oil law and signed more than 20 oil deals with foreign oil firms to explore and produce oil.

Oil Minister Hussain al-Shahristani calls the moves illegal and threatens to blacklist any company that has signed with the KRG from doing business in the rest of Iraq, where most of the 115 billion barrels of proven reserves are located.

The KRG wants the oil sector governed in a decentralized way, while Baghdad and most Iraqis want it nationalized and controlled by the central authorities.

According to the article, the four parties aligned on the oil deals will also form a new political bloc to oppose the Maliki government.

International Security - Energy - Briefing - UPI.com

Talabani denies KC plans to quit Maliki govt.
Kurdish leaders denied that KC was planning to quite Maliki's government.

Iraqi President Jalal Talabani denied on Saturday that the Kurdistan Coalition (KC) was planning to quit Iraqi Prime Minister Nouri al-Maliki's national unity government due to failure of late last year's negotiations between the two sides.

"We advocate dialogue and negotiation with Prime Minister Nouri al-Maliki in order to reach a solution for all issues. There are no plans by the KC to quit the national unity government," Talabani said in a joint press conference with Iraqi Kurdistan President Massoud ala-Barazani after their meeting in the Docan retreat in the Kurdish province of al-Sulaimaniya.

The KC is the second largest bloc in Iraq's parliament with 55 out of a total 275 seats.

A high-ranking delegation led by Iraq's Kurdistan Region Prime Minister Nechirvan Barzani had paid a visit to Baghdad early last month for talks with the central government on article 140 of the Iraqi constitution pertaining to Kirkuk, the Kurdish peshmerga forces' appropriations and oil contracts signed by the autonomous region with a number of foreign companies, which were objected by the central government.

According to statements by Kurdish officials then, the delegation returned to Iraqi Kurdistan with zero outcome.

Meanwhile, Talabani and Barazani denounced the bombing that occurred in Turkey's predominantly Kurdish city of Diyarbakir.

"We denounce the bombing and consider it as an act of antagonism against the Turkish people. We believe that these criminal operations are carried out by groups that want to mar Turkish-Kurdish relations," Talabani said.

The Iraqi foreign ministry had released a statement on Saturday in which it strongly condemned the "terrorist sabotage" in Diyarbakir, which killed or wounded scores of innocent civilians in Turkey.

Recent months have seen tension in Iraqi-Turkish relations due to the activities of the Kurdistan Workers Party (PKK) against the Turkish forces in northern Iraq. Turkey considers the PKK, or Partiya Karkeren Kurdistan in Kurdish, as "terrorist" group.

On negotiations with Iran to demark their joint borders and the fate of the Algiers agreement signed in 1975 between the two sides, Talabani replied that "there is an Iraqi delegation in Iran at the moment to negotiate this affair."

The Iraqi leader dismissed reports that the United States has anything to do with the negotiations.

"Don't forget that it was (the former U.S. Secretary of State) Henry Kissinger who engineered the Algiers agreement," Talabani said.

The Iraqi and Iranian sides are now having negotiations on the re-demarcation of borders, including the Shatt al-Arab area, away from the Algiers agreement, some of whose items are objected by the Iraqi sides. The agreement caused ignited a crisis between the two neighboring countries last month after Talabani gave statements taken by the Iranian side as an announcement to cancel the agreement.

Dispaly Article

Iraqi Kurd Warns Against Kirkuk Strife
BAGHDAD — Iraq's Kurdish deputy prime minister warned Monday that failure to resolve the fate of the oil-rich city of Kirkuk could result in more strife and accused people within the government of blocking a solution.

"We have a choice," Barham Saleh told The Associated Press. "We can either turn Kirkuk into an example of national Iraqi unity ... or turn it into a battlefield for strife between the components of Iraq."

A referendum is expected later this year on whether Kirkuk will join the semiautonomous Kurdish zone to its north, or continue to be ruled by Baghdad.

Saleh said it was unacceptable to leave the dispute unresolved and accused unnamed people within the government of Shiite Prime Minister Nouri al-Maliki of trying to stymie a solution spelled out in the 2005 constitution.

"I am a Kurd and see Kirkuk as part of the Kurdish region," Saleh said, explaining that because Arabs and Turkomen _ the other two main ethnic groups inhabiting the city _ see it differently, the issue must be resolved under current law.

Kirkuk's Arab and Turkomen residents dispute the Kurdish claim to the city, which has over the past 4 1/2 years seen hundreds of deadly attacks with sectarian or ethnic motives.

Leaders of Iraq's Shiite majority fear allowing Kirkuk to join the Kurdish region could undermine their new status as the country's dominant power, while the once-dominant Sunni Arab minority sees the loss of the city as a prelude to the breakup of the nation along sectarian or ethnic lines.

Saleh, like President Jalal Talabani, is widely viewed as a moderate Kurd and his assertion that Kirkuk is part of the Kurdish region reflects a universal conviction among Kurds. But his charge that government parties were working against a solution in Kirkuk reflects tension between the Kurds and their close Shiite allies.

The Kurds and Shiites, who combine for about 80 percent of Iraq's population, have been close allies since Saddam's ouster in 2003, but recent Kurdish assertions of independence, like the conclusion of oil exploration deals with foreign companies, without involving the central government, have led to harsh public exchanges.

The constitution, which most of Iraq's Sunni Arabs voted against in a 2005 referendum, provides for the "normalization" of Kirkuk _ allowing Kurds forcibly moved from the city under Saddam Hussein's "Arabization" program to return and inviting Arabs lured there decades ago by financial reward to leave in return for compensation.

FOXNews.com - Iraqi Kurd Warns Against Kirkuk Strife - International News | News of the World | Middle East News | Europe News

Iraq's Akkaz gas could go to Syria, Europe

Iraq is looking to develop the western Akkaz gas field, which may feed European customers via Syria.

Iraq has 112 trillion cubic feet of natural gas reserves, though the infrastructure is vastly undeveloped, with most of the gas found when producing oil burns off.

Oil Minister Hussain al-Shahristani told al-Arabiya the gas field "now has five wells that are ready to be interconnected and provide the Syrian market with approximately 50 million cubic feet per day of Iraqi gas."

Shahristani said he plans to visit the European Union "this month to agree with them on supplying Europe with Iraqi gas."

The Middle East Economic Survey reports Akkaz could also feed 450 million cubic feet per day of natural gas to the planned Nabucco pipeline, which would head to European customers.

Europe is looking to find Russian alternative sources of natural gas, and Iraq has some of the largest underexplored and underdeveloped gas reserves in the world.

Shell is likely to be a top candidate for a deal to develop Akkaz, MEES reports, and has produced a development plan for Iraq's gas sector.

International Security - Energy - Briefing - UPI.com

Iraqi oil dreams

No mandarin in the Iraqi oil ministry is likely to dine alone over the next few years. Every international major has people on the ground, spending big sums on soft persuasion. The spadework should pay off once the country's long-delayed hydrocarbons law is ratified and access to the world's second-largest crude reserve is finally divvied up. But drawing up that law is proving divisive. The majors generally prefer long-term production sharing contracts for development, for example, under which they can book reserves on their balance sheets. The ministry, meanwhile, has signalled that more restrictive service contracts may be used for certain fields, which do not provide the risk-adjusted returns the majors are after.

Then there is the problem of Kurdistan. Before Christmas, DNO of Norway, the only overseas company actually producing oil in Iraq, doubled its recovery estimates from its Tawke field in the region. The fact that DNO's shares barely budged, in spite of a big increase in the company's implied net asset value, suggests deep reservations among investors over a denationalised Iraqi oil industry.

FT.com / Lex - Iraqi oil dreams

India's Reliance to sign up for Iraqi oil assets

Reliance Industries Ltd, India's top exploration firm, will seek a role in developing oil assets in Iraq despite signing contracts with its largely autonomous Kurdish region, a move which angered Baghdad.

Reliance, the world's fourth-largest oil refiner, will register with Iraqi authorities so it can compete for tenders, P.M.S. Prasad, president and CEO of the company's petroleum business, told reporters at an industry event.

"We will register in Iraq. We are keen to be there. We believe there will be some kind of reconciliation between northern Iraq and rest of Iraq," he said.

Iraq holds the world's third-largest reserves of crude oil with 115 billion barrels of proven supplies, only after Saudi Arabia and Iran.

Shares in Reliance, which had more than doubled in 2007, rose 1.2 percent to a record close of 3,050.50 rupees in a Mumbai market that ended 0.3 percent up.

"This is a hugely positive move for Reliance in terms of securing oil and gas assets abroad," said Rohit Nagraj, an oil sector analyst with Angel Broking Ltd.

Last week, Baghdad set a deadline of Jan. 31 for international oil firms to register with it for participation in tenders expected to be issued soon for oil exploration and service contracts in southern, central and northern Iraq.

But it has threatened to blacklist oil companies, such as Reliance, that have signed deals with the Kurdish Regional Government (KRG).
In November, Reliance signed contracts with the KRG for two onshore blocks, Rovi and Sarta.

The Kurdish administration is moving ahead with plans to attract international energy companies to explore for oil and gas in the region, and has struck production sharing agreements with various firm, despite Baghdad's objections.

Reliance, which has been actively pursuing petroleum exploration activities in the Middle East, Asia-Pacific region and South America, also owns exploration blocks in Yemen, Oman, East Timor, Australia and Colombia through its subsidiaries.

On Tuesday the firm reiterated that it hopes to commission a new refinery adjacent to its 660,000 barrels per day plant at Jamnagar in the western state of Gujarat ahead of its original target date of December.
"It will be ahead of schedule. We want to do it three four months ahead," Prasad said.

The under-construction 580,000 bpd unit is being built by Reliance subsidiary Reliance Petroleum Ltd, and will make Jamnagar the world's biggest refining complex.

Oil major Chevron Corp owns a 5 percent stake in Reliance Petroleum, with an option to raise it to 29 percent.

UPDATE 2-India's Reliance to sign up for Iraqi oil assets | Markets | Reuters

Update......

Power in Iraq's north cut by fuel, Turkey

Gas feeding northern Iraq power generators and supply from Turkey has been cut, hampering an electricity sector also facing regular attacks.

An Iraq Electricity Ministry spokesman said a "technical failure" in an oil field where the gas comes from has shut generators in Mosul, Kirkuk and Baiji, the Voices of Iraq news agency reports.

Aziz al-Shimari added maintenance on a power line from Turkey has reduced electricity supply by 40 percent.

"A technical failure hit the oil field three days ago," Shimari said, "suspending the gas, which feeds the northern generators."

He said it will take an "unspecified amount of time" to fix the Ugail oil field, located in Kirkuk.

Power was affected in Kirkuk, Baiji and Mosul.

"The Iraqi network lost a total of 500 megawatts because of the (suspension) in the Turkish-Iraqi line three days ago due to maintenance works on the Turkish side," Shimari added, "which led to the loss of about 200 megawatts."

On Saturday saboteurs bombed a tower, cutting power between Baiji and areas west of Baghdad.

At least 1,211 workers in Iraq's power sector have been targeted like their colleagues in oil, according to an assessment from March 2003 to Nov. 17, 2007, made for United Press International by an expert in threats and vulnerabilities to the energy sector *********.

There have been 651 attacks on distribution and transmission lines and towers, 66 attacks on thermal power stations, five on hydroelectric power stations and 13 on power substations.

Meanwhile, Electricity Minister Karim Waheed Hasan is meeting in Amman with his Jordanian counterpart.

The Al Sabaah newspaper reports Jordan has pledged support and cooperation for enhancing Iraq's power sector.

International Security - Energy - Briefing - UPI.com

Iraq's Crude Oil Exports Jump To Record In December

Iraqi oil exports raced to a fresh high of 1.97 million barrels per day in December thanks to an uptick in sales from the northern Kirkuk fields, while rough weather in the Mideast Gulf barely dented sailings from the Basrah Oil Terminal. The December exports came in just above an upward revised 1.92 million b/d in November, shipping data show. Of this, 410,000 b/d of Kirkuk was shipped through the north and 1.56 million b/d of Basrah Light through the Mideast Gulf in the south.

Iraq's Crude Oil Exports Jump To Record In December

OPEC-10 Jan output slips but above target-consultant

Ten members of OPEC are lowering oil output further in January, improving compliance with a deal to cut production and prop up prices, an industry consultant said on Wednesday.

The 10 members, which exclude Iraq and Angola and are subject to output limits are expected to pump 27.1 million barrels a day in January, down 200,000 bpd from December, Geneva-based Petrologistics said.

January's supply is still higher than the target for the 10 countries of 26.3 million bpd. A new supply reduction of 500,000 bpd comes into force from Feb. 1.

"They have cut a little bit more -- it's bits and pieces, but not much," said Conrad Gerber, head of Petrologistics.

Supply from top world exporter Saudi Arabia is expected to be virtually unchanged at 8.75 million bpd in January, compared with 8.76 million bpd in December, Gerber said.

Output from Iran, OPEC's second largest producer, is expected to drop about 50,000 bpd to 3.85 million bpd, and Kuwait's production is running about 40,000 bpd lower than in December, he said.

Including Iraq and Angola, production by the 12-member Organization of the Petroleum Exporting Countries is expected to rise to about 30.6 million bpd this month.

Iraq's output is steady so far in January at around 1.95 million bpd but volumes from Iraq's tender to sell Kirkuk crude will probably push the figure up, Gerber said.

Iraq awarded a million barrels of crude each to three European refiners in its first Kirkuk oil sales tender since September, an Iraqi oil ministry source said on Monday.

France's Total, Spain's Cepsa and Italy's ERG will each load million-barrel Kirkuk cargoes from Ceyhan in Turkey before the end of January, the source said.

Angola, which became an OPEC member on Jan. 1, is pumping about 1.6 million bpd this month, according to Petrologistics.

UPDATE 1-OPEC-10 Jan output slips but above target-consultant | Markets | Reuters

A Surge Against Maliki

By David Ignatius
Wednesday, January 9, 2008; A15

A new movement to oust Iraqi Prime Minister Nouri al-Maliki is gathering force in Baghdad. And although the United States is counseling against this change of government, a senior U.S. official in the Iraqi capital says it's a moment of "breakthrough or breakdown" for Maliki's regime.

The new push against Maliki comes from Kurdish leaders, who, U.S. and Iraqi sources told me, sent him an ultimatum in late December. "The letter was clear in saying we are concerned about the direction of policies in Baghdad," said a senior Kurdish official. He described the Dec. 21 letter as "a sincere effort from the Kurdish parties to help the government reform -- or else."

The Kurds are upset that Maliki hasn't delivered on promises they say he made to them last summer, when he was trying to stave off an earlier attempted putsch. Maliki pledged then that his government would pass an oil law and a regional-powers law, and that it would conduct a referendum on the future of Kirkuk. None of these promises has been fulfilled, and the Kurds are angry.

The strongest anti-Maliki voice is Massoud Barzani, the dominant political leader in Kurdistan. Barzani agreed to back Maliki last summer after a personal telephone call from President Bush. Now, fuming about Turkish attacks across the border last month and the delay on Kirkuk, Barzani is on the warpath.

Ryan Crocker, the U.S. ambassador in Baghdad, met after Christmas in Kurdistan with Barzani and Jalal Talabani, the Iraqi president and the region's other ruling warlord. In a telephone interview yesterday from Baghdad, Crocker said his message to the Kurds was: "We think everyone should be placing emphasis on making the government more effective, not on changing the government."

Although U.S. officials are counseling against removing Maliki, they agree that the prime minister must govern more effectively and inclusively in coming months -- or suffer the "breakdown" described by the senior U.S. official. "Clearly there is a sense among the Kurds, Sunnis and Shiites that the government isn't doing what it's supposed to do," he explained. "It needs to get better quick."

The anti-Maliki forces would like to replace him with Adel Abdul Mahdi, one of Iraq's vice presidents and a leader of the Supreme Islamic Iraqi Council, headed by Abdul Aziz al-Hakim. Mahdi's supporters think they can muster the 138 votes needed for a no-confidence vote in parliament, by combining 53 votes from the Kurdish parties with 55 from Sunni groups and 30 from Hakim's Islamic Council. Add another 40 votes from supporters of former prime ministers Ayad Allawi and Ibrahim al-Jafari, and you're close to the two-thirds majority needed to form a new government.

The rumor mill in Baghdad is already floating the names of officials who would take cabinet posts in a new government. The Kurds are said to want key security portfolios, perhaps including control over intelligence through the Ministry of National Security. Various candidates have been proposed to take over the Energy Ministry -- and halt what is said to be massive smuggling of oil from the southern Iraqi pipeline across the border to Iran.

The biggest obstacle to removing Maliki is the Shiite religious leader, Grand Ayatollah Ali Sistani, who is said to be frustrated with Maliki's poor performance but wary of dividing the Shiite alliance. "Najaf [Sistani's headquarters] is unhappy," said one top Iraqi leader. But the senior U.S. official said he was "certain" that Sistani had not yet blessed any change of government.

Though Bush administration officials share the Iraqi frustration with Maliki, they fear that a change of regime would add delay and distrust to the already chaotic political scene in Baghdad. "How long would such a transition take? How long before they would form a new government?" worries a second senior U.S. official.

Rather than dumping Maliki, the administration hopes to work around him, by operating through a coalition known as the "three plus one." That group includes, in addition to Maliki, President Talabani and vice presidents Mahdi and Tariq al-Hashimi. "Our message to Maliki is that you can't govern solo. You have to govern as part of a group," says the second senior U.S. official. With a push from this governing alliance, Crocker hopes the Iraqi parliament will pass a law easing de-Baathification as early as the end of this week, and a budget by mid-January -- finally breaking the political logjam.

For an America caught up in its own political drama, the Baghdad primary seems remote. But what happens in Iraq during the next several weeks will shape events there for the rest of 2008. For Maliki, just back in Baghdad after a visit to London doctors for treatment for exhaustion, it's "make or break" time.

The writer is co-host ofPostGlobal, an online discussion of international issues. His e-mail address [email protected].