Iraq Oil Report

Plus:
*Oil Ministry cracks down more on oil firms signing deals with Kurds
*Kirkuk pipeline cutting short planned oil sales
*Oil refineries, power plants have a bad week
*Much, much more…

Iraq’s Oil Ministry spent $558 million on capital projects in 2007 to improve its struggling oil sector. Or $500 million. Or only $270,000.

A new report by the U.S. Government Accountability Office isn’t sure. Its attempt to measure the Iraqi government’s ability to put its capital budget into motion was frustrated by “widely disparate” numbers from the U.S. State and Treasury departments and the Iraq Ministry of Finance.

The State Department said Iraq’s central government spent 24 percent of its capital budget through July 15, 2007. The Treasury Department pegs it at 4.4 percent through August.

“The disparity between the different sets of data calls into question their reliability and whether they can be used to draw firm conclusions about the extent to which the Iraqi government has increased its spending on capital projects in 2007, compared with 2006.”

Read the entire story by Ben Lando for United Press International. Click HERE.

Iraq’s Oil

The Iraqi Oil Ministry has decided to stop cooperating with international oil companies participating in production-sharing contracts with the Kurdish regional administration in northern Iraq, an official said Thursday, Dow Jones Newswires reports. The Oil Ministry appears to be making good on threats it would respond to the Kurdish oil deals not by stopping the Kurds, but forcing oil companies to choose between having anything to do with Iraq’s oil sector as a whole or the KRG area specifically.

One of the companies who has signed with the KRG but not Baghdad – though its top management was trying to sweet talk Baghdad at a conference last fall in Dubai – is the Norwegian firm DNO. It’s global production was up 40 percent from 2006 to 2007, buoyed with good returns on their Kurdish investment.

Canada’s Addax Petroleum also is involved in the KRG dealings, Eric Reguly reports for the Globe and Mail,and has seen proven and probable reserves up 26 percent.

Iraq may face oil sale shortfall, Gulf Daily News reports. A halt in crude oil pumping along Iraq’s northern pipeline to Turkey raises doubts about Baghdad’s ability to meet commitments to sell more than 300,000 barrels per day, traders said yesterday.

Fueling Iraq

Production has halted at two major Iraqi refineries leading to unprecedented fuel and power shortages in the country, by Abdulatif al-Mawsawi for Azzaman.

Police forces foiled an attempt to smuggle large amounts of oil derivatives in eastern Muthanna city, a local police chief said, Voices of Iraq reports.

Powering Iraq

Electricity cuts that blacked out Iraq’s northern oilfields and main refinery this week were a timely reminder that its hopes of boosting oil production rest on something it does not have — a dependable power supply, Ross Colvin reports for Reuters.

The halt of Turkish exports of electricity to Iraq and a lack of fuel for power stations is to blame for the blackouts hitting Iraq’s northern oil fields, the Electricity Ministry said on Thursday, Reuters reports.

Security, Society & Politics

Read what’s in Iraq’s editorial pages. The Iraq Press Roundup, by UPI’s Hiba Dawood.

Iraq’s Shiites between Sectarianism, Iraqi Nationalism, and Mahdism, by Reidar Visser at Historiae.org

In 2008, both these two themes – Iraqi nationalism and Shiite sectarianism – are in evidence among the Shiites of Iraq. On the one hand, projects that clearly have a sectarian edge to them are still favoured by some – such as the idea of a single Shiite federal region, as sponsored by the Islamic Supreme Council of Iraq (ISCI). It is deeply ironic that its leader Abd al-Aziz al-Hakim should use the occasion to claim that the process of national reconciliation in Iraq has been “delayed” by the pet projects of individual politicians: ISCI’s own ideas about a single Shiite federal entity is arguably the clearest possible example of such projects, and Iraqi national reconciliation could have made great strides if this divisive scheme had simply been taken off the table. Similarly, there is unwillingness by some (but not all) Sadrists to accept concessions associated with the Sunnis like the new de-Baathification law. Its recent adoption in the Iraqi parliament was hailed by a few vocal Sadrist MPs, but thoroughly condemned on websites that express a more sectarian Sadrist view such as Nahrainnet, which has highlighted negative reactions to the bill among some of the lower-ranking clergy of the Shiite holy cities.

Reidar Visser is also research fellow at the Norwegian Institute of International Affairs. He’ll be at the U.S. Institute of Peace at the end of this month, one of four speakers on a panel titled Iraq’s Mystery Men: Insurgents, Tribes and Sadrists.

Iraq National Security Adviser Mowaffak al-Rubaie argues for Federalism, Not Partition: A System Devolving Power to the Regions Is the Route to a Viable Iraq, in a Washington Post op-ed.

An Iraqi “National Project,” without Kurds! Any such “project” will only be detrimental to Kurdish demands, Qassim Khidhir writes in The Kurdish Globe. He’s referring to the large swath of disaffected political parties who signed a pact decrying the KRG oil deals and other perceived threats to Iraqi national sovereignty.

Iraq’s parliament has finally passed a long-awaited new law aimed at allowing former Baathists to return to government jobs. Amb. Feisal al-Istrabadi, one of the “founding fathers” of the new Iraq, is optimistic about the legislation and says Iraqis are just undoing mistakes made by the United States. Seven Questions on the De-Bremerification of Iraq in Foreign Policy.

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