Iraq’s Ministry of Oil has reportedly announced that Iraqi gas reserves reached to 137 trillion standard cubic meters (sic) [cubic feet?], due the increase in exploration sites.

Spokesman Asim Jihad said investment and development operations comprised of three stages to reach the peak of production.

Earlier, oil under-secretary Fayadh Hassan said that Iraq is trying to be one of the main gas producing countries.

(Source: Aswat al-Iraq)

By John Lee.

Paulson & Co, the hedge fund run by John Paulson (pictured), has bought Cdn$70 million [$68.6 million USD] of WesternZagros 4.00% Convertible Senior Unsecured Notes (“Convertible Notes”).

A portion of the proceeds from the Private Placement have been used to repay the remaining Crest Energy International (“Crest”) debt of US$44.5 million plus accrued interest as per the terms of the loan agreement. The remaining proceeds will be used to fund the Company’s capital and operating activities.

Simon Hatfield, WesternZagros’s Chief Executive Officer commented:

“We are pleased to close this financing with Paulson. The funding provides Convertible Notes with a maturity date beyond that in the Crest loan and additional capital to finance a portion of additional exploration activities or pre-development activities the company pursues in 2014.“

The Convertible Notes have a face value of Cdn$1,000 per note, a coupon of 4 percent, a maturity date of December 31, 2015 and will be convertible into common shares of the Company (“Common Shares”) at the option of the holder at a conversion price of Cdn$1.45 per share (subject to adjustment in certain events), representing a conversion premium of approximately 27 percent to the thirty day average price for the Common Shares.

By John Lee.

Gulf Keystone has announced the commencement of the Company’s drilling campaign to explore deeper, yet untested horizons of the world class discovery at the Shaikan field, which the Company operates.

Shaikan-7, the first deep exploration well on the Shaikan block, is targeting the mid to lower Triassic and, potentially, Permian horizons, spudded late on Sunday 16 June 2013. The well is being drilled with the Weatherford Rig 319 (3000HP) close to the crest of the Shaikan structure, approximately 1 km east of the Shaikan-1 discovery well.

Shaikan-7 is being drilled to the lower Triassic to evaluate the potential for significant quantities of light oil and identify commerciality of the deeper Triassic reservoir. The well is then expected to penetrate the Permian, the deepest undrilled horizon to date on the Shaikan structure.

This vertical well is planned to reach a total depth below 4,500m in the Permian and the drilling is expected to take about 9 months.

Commenting on today’s announcement, John Gerstenlauer (pictured), Chief Operating Officer, said:

“As we are about to commence implementation of our Field Development Plan for the Shaikan discovery and start Jurassic production from the newly constructed Shaikan production facility, the spudding of our first deep exploration well adds a new and exciting dimension to Gulf Keystone’s work programme in 2013.

“With Shaikan-7, we hope to confirm our expectations of major reservoirs beneath the deepest horizon drilled to date and add to what is already recognised as one of the world’s largest onshore conventional oil & gas developments.“

(Source: GKP)

The United Nations welcomed the launch of the National Environment Strategy and Action Plan (NESAP) in Baghdad on Monday, on the occasion of the World Day to Combat Desertification.

“This is a landmark step, the first ever national strategy for the environment and a blueprint for sustainable development in Iraq,” said Martin Kobler, the Special Representative of the United Nations Secretary-General (SRSG) for Iraq, speaking on behalf of the UN.

“It is excellent to see this strategy launched on the World Day to Combat Desertification, under the theme, ‘Don’t let our future dry up’,” said Mr. Kobler. “Water scarcity and drought are threatening Iraq, with the Government estimating that water reserves are down to 20% capacity. Management of natural resources has not been adequate over the years, and there is a real risk that Iraq’s fields and waterways will turn to dust, an unthinkable future for a country that needs to sustain a growing population.”

“Iraq must combat desertification to sustain its urban populations and its arable land, avoid crop failure, and prevent the devastation brought by dust-storms that sweep across the country each year,” added Mr. Kobler.

Mr. Kobler said that the NESAP launch was a significant step in shoring up Iraq’s sustainable future and complementing regional initiatives, led by the United Nations Environment Program (UNEP) and the United Nations Development Programme (UNDP).

“I congratulate the Government for announcing 2014 as the Year of the Environment in Iraq,” said Mr. Kobler. “The United Nations now urges all necessary resources and partnerships to be committed to achieve the goals of the NESAP, and recommits its support to sustainable development in Iraq,” he concluded.

For more information on the environment in Iraq, please see the following UN Iraq Fact Sheets:

• Water in Iraq Fact Sheet
• Climate Change in Iraq Fact Sheet
• World Environment Day 2013 Fact Sheet on How Environmental Damage Causes Food Insecurity in Iraq

(Source: UNAMI)

(Picture: Dust Storm, Al Asad, April 27, 2005)

By Ahmed Mousa Jiyad.

Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Iraqi EITI Report 2011: The Need to Act Promptly,

Effectively and Properly

This contribution was based on PowerPoint presentations I delivered before “EITI Beyond Compliance Report Analysis Workshop” organised by Revenue Watch Institute-RWI (USA), Erbil, Iraq, 6-8 June 2013, and was attended by 20 of the strongest Extractive Industry governance focused Iraqi Civil Society Organisations-CSOs’ Coalition members.

Introduction

Iraq is required to present its Extractive Industry Transparency Initiative-IEITI Report 2011 by December 2013. The Secretariat and the Multi-Stakeholders Group of the IEITI hold critical, if not the prime, responsibility in the reporting process leading to releasing the national report in compliance with the EITI Standard.

Since the IEITI Report 2011 is expected to be qualitatively and quantitatively very different from previous two reports for 2009 and 2010, both the Secretariat and the Multi-Stakeholders Group face serious challenges in producing the anticipated high/ different quality report within the limited available time.

This paper focuses mainly on short term perspectives and attempts to identify the most important challenges, proposing some practical suggestion, identifying few opportunities of international cooperation and finally ends with concluding remarks.

The full paper can be downloaded here.

Mr Jiyad is an independent development consultant, scholar and Associate with Centre for Global Energy Studies (CGES), London. He was formerly a senior economist with the Iraq National Oil Company and Iraq’s Ministry of Oil, Chief Expert for the Council of Ministers, Director at the Ministry of Trade, and International Specialist with UN organizations in Uganda, Sudan and Jordan. He is now based in Norway (Email: mou-jiya@online.no).

President Masoud Barzani met with US State Department senior advisor Brett McGurk to discuss the recent political developments in Iraq and in the wider region.

Mr. McGurk lauded the recent rapprochement between the Erbil and Baghdad, including the visit to Erbil by Prime Minister Maliki and his meeting with President Barzani. He expressed US government’s support for this reconciliation and urged the President to play a role in resolving disputes between other Iraqi leaders.

President Barzani described the meeting with Prime Minister Maliki last week as positive but reiterated that practical progress needs to be made for full trust to be restored. He added that he is prepared to play a role in diffusing other problems in Iraq.

The President and the US State Department advisor also talked about the crisis in Syria, particularly the plight of more than 150,000 Syrian refugees in Kurdistan. President Barzani criticized international organizations and the international community in general for overlooking and failing to help Syrian refuges in Kurdistan. Mr. McGurk praised the hospitality offered to the refugees by the KRG and said his will convey the message from the President to the US government.

(Source: KRG)

By John Lee.

India’s external affairs minister, Salman Khurshid, starts a two-day visit to Iraq on Wednesday, during which he will hold talks with top Iraqi leadership on issues including the supply of oil.

Khurshid, the first senior Indian leader to visit Iraq since 1990, is expected to call on Prime Minister Nouri Al-Maliki, and chairman of Council of Representatives and deputy Prime Minister of Iraq.

According to a report from the Times of India, Iraq is now India’s second largest supplier of crude oil, replacing sanctions hit Iran.

India remains committed to support the ongoing post-war reconstruction and development efforts in Iraq, said a statement from the ministry of external affairs.

(Source: Times of India)

By Reidar Visser.

The following article was published by Reidar Visser, an historian of Iraq educated at the University of Oxford and currently based at the Norwegian Institute of International Affairs. It is reproduced here with the author’s permission. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Since the final results of the Iraqi local elections were certified in late May, Iraqi local politicians have moved with reasonable speed towards forming new councils and appointing new governors. There has been much speculation about the way alliances are shaping up, but as of today, 8 out of 12 provinces that held elections on 20 April have actually completed the formalities of establishing new local governments.

In an echo of what happened in 2009, coalition formation has been a process full of surprises and not always in line with the most obvious predictions that emerged from the results themselves. Generally speaking, there has been a tendency of Prime Minister Nuri al-Maliki’s own concept of a “political majority” being employed against him, mostly after fellow Shiites from ISCI and the Sadrists decided to join forces to challenge his dominance in several provinces. Often these political majorities are based on little else than strong personal enmity towards Maliki and his State of Law Alliance, but this sentiment has proved sufficient to create anti-Maliki coalitions in some, if not all, the Shiite-majority governorates.

Perhaps the best way to typologise the new local governments is to sort them according to the level of conflict between the main blocs in settling the governorships and other top positions (of which the speakership is the most important).

First, there are consensus-based governorates where the Sadrist-ISCI deal at the national level gave way to local agreements and did not succeed in marginalising Maliki completely. These include Basra (ISCI governor, State of Law speaker), Maysan (Sadrist governor, State of Law speaker), Qadisiyya (Fadila governor, ISCI speaker). In Basra, the competition started out as a ISCI-Sadr coalition but Maliki’s State of Law eventually agreed to take the speakership, perhaps as a face-saving mechanism. It is a remarkable outcome that ISCI with only 5 seats won the governor position, and that the previous pro-Maliki governor – perhaps one of Iraq’s most popular politicians with more than 130,000 personal votes – was demoted to the speakership position. For its part, Maysan has seen Shiite grand coalitions before and the Sadrists simply retain their pre-eminent position, whereas the emergence of a pan-Shiite consensus government in previously contested Qadisiyya is a new phenomenon.