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Fatih Birol (IEA) with Iraqi President Barham Salih

Iraq’s Energy Sector: Roadmap to a Brighter Future

Iraq, one of the world’s biggest energy producers, can address its current electricity shortfall and growing power needs through immediate action to relieve pressure on the system, according to an in-depth report published Thursday by the International Energy Agency.

It also provides a medium-term strategy that makes the best use of the country’s abundant oil and natural gas resources and solar potential.

Despite the extraordinary challenges of war in recent years, Iraq has made impressive gains, nearly doubling the country’s oil production over the past decade. But the turmoil has also undermined the country’s ability to maintain and invest in its power infrastructure.

The new IEA report, Iraq’s Energy Sector: A Roadmap to a Brighter Future, maps out immediate practical actions and medium-term measures to tackle the most pressing problems in Iraq’s electricity sector.

The analysis finds Iraq has huge potential to cut its electricity network losses, which are among the highest in the world. Reducing these losses by half would help dramatically improve the efficiency of grid supply, effectively increasing available capacity by one-third.

The report also takes a detailed look at the country’s oil and gas sector. It projects that Iraq’s oil production will grow by 1.3 million barrels a day by 2030, accounting for the third-largest increase globally over the period, and soon becoming the world’s fourth-largest oil producer behind the United States, Saudi Arabia and Russia.

The report also notes that more gas can be captured and put to use in efficient power plants. Today, 16 billion cubic meters of gas are flared each year, more than enough to replace Iraq’s current imports.

Dr Fatih Birol, the IEA’s Executive Director met, with Iraqi President Barham Salih on Wednesday in Baghdad, and presented the study’s findings and recommendations. He then met with Prime Minister Adil Abdul-Mahdi to discuss ways forward for the electricity sector, including making best use of Iraq’s significant natural gas and solar resources.

On Thursday, Dr Birol will discuss the report at a press conference with Thamir Ghadhban, the Deputy Prime Minister for Energy and Minister of Oil, and Luay Al-Khatteeb, the Minister of Electricity.

The IEA has worked closely with the Iraqi Ministries of Oil and Electricity to produce the report, and would like to thank the ministers and their staff for their cooperation with this study.

“Operating under extremely challenging circumstances, Iraq has done a remarkable job expanding its oil industry,” said Dr Birol. “Today’s urgent issue is to address the national power sector as the summer heatwave approaches by improving grid maintenance, boosting electricity production with larger mobile generators, and incentivising upgrades of power plants. The IEA is pleased to recommend immediate practical actions for the benefit of the entire Iraqi people, and provide a roadmap for a sustainable power system in the medium term.”

Iraq’s electricity demand is set to double between now and 2030, and its shortfall in electricity supply will widen, as the country’s population grows by more than 1 million people each year.

Without changes to the current structure of electricity supply and improvements to the network, domestic generation, imports and neighbourhood generation would need to double by 2030, for a total supply of over 250 TWh. However, there are many opportunities to improve on this outcome through measures such as investing in transmission and distribution to cut network losses.

Promoting the more efficient use of electricity, including by introducing more progressive tariffs, would play an important role in ensuring that the growth in demand during the summer peak does not continue to outpace supply.

Iraq also needs to take advantage of its abundant renewable energy potential.  The analysis shows that expanding the share of solar PV and wind to 30% of electricity supply by 2030 would bring benefits both to the Iraqi consumer, in the form of reduced electricity bills, and to the environment.

Reducing network losses and moving towards an electricity mix where renewables play a more prominent role would free up 9 billion cubic meters of gas for other uses in 2030, plus 450 kb/d of oil for export.

“In addition to oil, Iraq is blessed with some of the richest solar and gas resources in the world but it is yet to take advantage of them,” Dr Birol said. “Turning that potential into fuel for its own economy and for export would help bring about a more sustainable, reliable and affordable energy future.”

The report is the second in-depth study of Iraq’s energy sector following the publication of the Iraq Energy Outlook in 2012.

Download the report here.

(Source: IEA)

Posted in Iraq Oil & Gas News 0 Comments

Oil (NIC)

Iraq “becomes Energy Investment Hotspot”

By John Lee.

According to Miriam Malek, writing for S&P Global Platts, Iraq is again becoming a viable destination for energy investment after the final defeat of Islamic State and the election of a new government revived interest in the region’s second-largest oil producer.

The US, Qatar, Saudi Arabia and Iran are now vying for a share in the spoils.

Click here to read the full article.

(Source: S&P Global Platts)

Posted in Investment, Iraq Oil & Gas News 0 Comments

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TAQA Acquires Schlumberger’s Iraq Business

Saudi Arabia’s Industrialization and Energy Services Company (TAQA) has announced that its drilling subsidiary, Arabian Drilling Company (ADC), has agreed to acquire Schlumberger’s Middle East onshore drilling rigs business in Kuwait, Oman, Iraq and Pakistan for $415 million (SAR 1.56 billion).

According to a TAQA press release, the transaction transforms ADC into a regionaldrilling leader with one of the largest rig fleets, client portfolios and geographic footprints in the Middle East. ADC, a drilling rig partnership between TAQA and Schlumberger, was established in 1964 through a royal decree.

Through this expansion, ADC, Saudi Arabia’s current market leader and drilling national champion, will become an industry powerhouse, operating a superior fleet of 58 onshore rigs and 9 offshore rigs across the MENA region. The combined firm will have more than 5,900 employees and builds on ADC’s long-standing reputation of reliably serving national and international oil and gas companies for over 55 years.

The transaction will combine the outstanding track records of the parties with respect to operations, quality of service, health, safety and environment. It will also create economies of scale and cost synergies, making ADC a regional leader, encompassing a diversified, multi-country and multi-client offering.

For TAQA, the expansion represents a major step forward in its ongoing group-wide transformation and growth strategy. TAQA’s 2021 strategy is to become a leading regional oilfield services and equipment (OFSE) company and is based on three key pillars:

  1. creating value by strengthening the position and growth of its existing businesses and expanding into higher-tier services and new markets,
  2. sustaining value by providing differentiated, best-in-class client services and safety, using the latest technologies, and,
  3. realizing value and greater operational efficiencies by delivering more integrated client services that are safe, reliable and competitive.

“This acquisition is fully aligned with Saudi Vision 2030. It unlocks value and drives growth across our entire value chain through a more integrated regional approach, while positioning a leading Saudi company as a global player,” said TAQA chief executive officer Azzam Shalabi, who is also chairman of the ADC Board.

He said the transaction also follows on from ADC’s accelerated expansion activity in 2018 when 16 rigs were commissioned to support the growth of Saudi Aramco.

“This new combination clearly demonstrates that TAQA and ADC are delivering on their transformation and growth strategies, and further strengthens what is already a long-standing and trusted partnership between TAQA and Schlumberger. We look forward to supporting ADC in the next phase of its expansion and have full confidence that this will benefit all stakeholders, most notably our regional clients,” he added.

The transaction is expected to close in the second half of 2019, subject to regulatory approvals.

Moelis & Company acted as exclusive financial advisor to TAQA, and Rothschild & Co. acted as exclusive financial advisor to Schlumberger.

(Source: TAQA)

Posted in Construction & Engineering In Iraq 0 Comments

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Immediate Actions to tackle Iraq’s Electricity Problems

New IEA report provides practical roadmap to address Iraq’s current electricity shortfall and future energy needs

Iraq, one of the world’s biggest energy producers, can address its current electricity shortfall and growing power needs through immediate action to relieve pressure on the system, according to an in-depth report published Thursday by the International Energy Agency (IEA).

It also provides a medium-term strategy that makes the best use of the country’s abundant oil and natural gas resources and solar potential.

Despite the extraordinary challenges of war in recent years, Iraq has made impressive gains, nearly doubling the country’s oil production over the past decade. But the turmoil has also undermined the country’s ability to maintain and invest in its power infrastructure.

The new IEA report, Iraq’s Energy Sector: A Roadmap to a Brighter Future, maps out immediate practical actions and medium-term measures to tackle the most pressing problems in Iraq’s electricity sector.

The analysis finds Iraq has huge potential to cut its electricity network losses, which are among the highest in the world. Reducing these losses by half would help dramatically improve the efficiency of grid supply, effectively increasing available capacity by one-third.

The report also takes a detailed look at the country’s oil and gas sector. It projects that Iraq’s oil production will grow by 1.3 million barrels a day by 2030, accounting for the third-largest increase globally over the period, and soon becoming the world’s fourth-largest oil producer behind the United States, Saudi Arabia and Russia.

The report also notes that more gas can be captured and put to use in efficient power plants. Today, 16 billion cubic meters of gas are flared each year, more than enough to replace Iraq’s current imports.

Dr Fatih Birol, the IEA’s Executive Director met, with Iraqi President Barham Salih on Wednesday in Baghdad, and presented the study’s findings and recommendations. He then met with Prime Minister Adil Abdul-Mahdi to discuss ways forward for the electricity sector, including making best use of Iraq’s significant natural gas and solar resources.

On Thursday, Dr Birol will discuss the report at a press conference with Thamir Ghadhban, the Deputy Prime Minister for Energy and Minister of Oil, and Luay Al-Khatteeb, the Minister of Electricity.

The IEA has worked closely with the Iraqi Ministries of Oil and Electricity to produce the report, and would like to thank the ministers and their staff for their cooperation with this study.

“Operating under extremely challenging circumstances, Iraq has done a remarkable job expanding its oil industry,” said Dr Birol. “Today’s urgent issue is to address the national power sector as the summer heatwave approaches by improving grid maintenance, boosting electricity production with larger mobile generators, and incentivising upgrades of power plants. The IEA is pleased to recommend immediate practical actions for the benefit of the entire Iraqi people, and provide a roadmap for a sustainable power system in the medium term.”

Iraq’s electricity demand is set to double between now and 2030, and its shortfall in electricity supply will widen, as the country’s population grows by more than 1 million people each year.

Without changes to the current structure of electricity supply and improvements to the network, domestic generation, imports and neighbourhood generation would need to double by 2030, for a total supply of over 250 TWh. However, there are many opportunities to improve on this outcome through measures such as investing in transmission and distribution to cut network losses.

Promoting the more efficient use of electricity, including by introducing more progressive tariffs, would play an important role in ensuring that the growth in demand during the summer peak does not continue to outpace supply.

Iraq also needs to take advantage of its abundant renewable energy potential.  The analysis shows that expanding the share of solar PV and wind to 30% of electricity supply by 2030 would bring benefits both to the Iraqi consumer, in the form of reduced electricity bills, and to the environment.

Reducing network losses and moving towards an electricity mix where renewables play a more prominent role would free up 9 billion cubic meters of gas for other uses in 2030, plus 450 kb/d of oil for export.

“In addition to oil, Iraq is blessed with some of the richest solar and gas resources in the world but it is yet to take advantage of them,” Dr Birol said. “Turning that potential into fuel for its own economy and for export would help bring about a more sustainable, reliable and affordable energy future.”

The report is the second in-depth study of Iraq’s energy sector following the publication of the Iraq Energy Outlook in 2012.

(Source: IEA)

Posted in Construction & Engineering In Iraq 0 Comments

Adil Abdul-Mahdi and PM Rouhani of Iran, 060419

Iraq Struggles to Distance itself from US-Iran Tensions

By Ali Mamouri for Al-Monitor. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Iraq struggles to distance itself from US-Iran tensions

Iraq is trying hard to dissociate itself from the rising hostilities between Iran and the United States, as it hopes to preserve its national interests without aligning with either axis in the conflict.

Following his recent visit to Iran, Iraqi Prime Minster Adel Abdul Mahdi announced April 9 that he will soon visit Saudi Arabia to sign economic and security agreements, as Iraq has done with Jordan and Iran.

A high-ranking Saudi delegation visited Iraq last week and signed several agreements, including ones involving electricity imports to Iraq and the construction of a large stadium.

Click here to read the full story.

Posted in Politics, Security 0 Comments

Adil Abdul-Mahdi with Saudi Crown Prince Mohammed Salman

Iraq and Saudi sign 13 New Agreements

By John Lee.

Iraq and Saudi Arabia have signed 13 political and economic agreements during the visit by Prime Minister Adel Abdul Mahdi to the Saudi capital Riyadh.

According to Reuters, Iraqi Oil Minister Thamer Ghadhban has said that Saudi state-owned oil giant Saudi Aramco will help Iraq explore for gas in the western desert.

Saudi Arabia cut ties with Baghdad after it invaded Kuwait in 1990, but the new moves are seen as a sign of improving relations between the two countries.

(Sources: Office of the Iraqi Prime Minister, The National, Reuters)

Posted in Construction & Engineering In Iraq 0 Comments

Trade Bank of Iraq (TBI) logo

Trade Bank of Iraq to open first Saudi Branch

By John Lee.

The state-owned Trade Bank of Iraq (TBI) will reportedly open its first operational branch outside Iraq on Thursday.

Chairman and President Faisal Al-Haimus told Arab News that the new branch in Saudi capital Riyadh will also be the only active Iraqi bank in the Kingdom.

(Source: Arab News)

Posted in Iraq Banking & Finance News 1 Comment

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Iraq offered Saudi 186 Investment Opportunities

Saudi Minister of Commerce and Investment, Dr. Majid Bin Abdullah Al-Qasabi, said that Iraq has offered Saudi companies and investors 186 investment opportunities.

Speaking at a joint press conference with Iraqi Deputy Prime Minister, Thamir Al-Ghadhban, Al-Qasabi said the two countries have decided to set up a joint Saudi-Iraqi business council to exchange investment opportunities.

He pointed out that the business council will be signed during Iraqi Prime Minister Adel Abdul Mahdi’s upcoming visit to Riyadh.

The two countries have also decided to establish a free trade zone.

For his part, Al-Ghadhban said “the Saudi-Iraqi Coordination Council has discussed a number of issues while the committees have completed preparing some files that will be signed in Riyadh.”

(Source: Middle East Monitor)

Posted in Investment 0 Comments

Saudi Iraq Kuwait border map

Saudi Arabia to give Iraq $1bn to build Sports City

By John Lee.

Saudi Arabia’s King Salman has reportedly committed a grant of $1 billion to build a sports city in Iraq.

A high level Saudi delegation traveled to Baghdad on Wednesday for meetings with Iraqi officials on trade and investment.

(Sources: Arab News, Reuters)

Posted in Construction & Engineering In Iraq, Leisure and Tourism in Iraq 1 Comment

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New Iraq-Saudi Border Crossing to be Hi-Tech

By John Lee.

The General Company for Land Transport (GCLT) has held a meeting with its Saudi Arabian counterpart to discuss the opening of the Arar border crossing between the two countries.

According to a statement from Iraq’s Ministry of Transport, the participants stressed the importance of the new border facility for commercial trade and religious tourism.

A report this week from Asharq al-Awsat quotes the Chairman of Saudi Arabia’s General Customs Authority, Ahmed al-Hakbani, as saying that the new crossing will be equipped with state-of-the-art technology and meet international standards, adding that he expected it to become “the top global crossing in terms of technology.”

(Sources: Iraqi Ministry of Transport, Asharq al-Awsat)

Posted in Iraq Industry & Trade News, Iraq Transportation News, Leisure and Tourism in Iraq Comments Off on New Iraq-Saudi Border Crossing to be Hi-Tech