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Abu Dhabi National Energy (TAQA), a state-owned oil explorer and power supplier, said it bought a 50 percent interest in a power plant in Iraqi Kurdistan.

According to Reuters, the plant, which has been operating since 2009, has a capacity of 750 megawatts, with an additional 250 megawatts under construction.

The company signed a joint venture agreement with Mass Global Investments for the purchase.

"There is a 15 year take or pay agreement in place with the Ministry of Electricity, Kurdistan Region. The facility receives gas from an underground pipeline connecting the Khor Mor gas field to the plant," a company spokesman told Reuters.

The National reports that the company also has a stake in WesternZagros, the Canadian oil company that is exploring two blocks in Kurdistan.

(Sources: Reuters, Bloomberg, The National)

The Kurdistan Parliament approved the new Kurdistan Regional Government cabinet on Thursday. Incoming Prime Minister Nechirvan Barzani (pictured) and his ministers were sworn in to begin their two-year term.

While many of the ministers remain in their previous positions, nine new ministers were sworn into the 7th cabinet.

Announcing the agenda of the new cabinet, Prime Minister Barzani said that Kurdistan needs a collective effort to maintain progress and promote national unity, in spite of individual political and ideological differences. “We must begin a national dialogue to build a consensus on how we can improve our society,” he said.

“We also must have a united front in our negotiations with Baghdad, and at present the mechanism does not exist to create this united view. We must move ahead quickly with the formation of a High Council for Negotiations to oversee these discussions. All parties – government and opposition – must participate in this Council so that we can develop a meaningful consensus among ourselves on how to approach these difficult issues,” he added.

The new Prime Minister went on to describe plans to increase government transparency and to implement a policy to help separate the functions of political parties from the operations of the government as a whole, as well as initiatives to deliver better services to the people of Kurdistan and make better provision for the disadvantaged and poor.

The new cabinet was approved in keeping with the legal timeframe set by President Masoud Barzani’s call to form the new cabinet, on March 7. The members of the 7th Cabinet sworn into posts are:

ABB, the global power and automation technology group, has won an order from the Ministry of Electricity (MOE) in Iraq to provide a state-of-the-art power distribution management system. The solution will incorporate advanced communication technology, with monitoring and control functions, to improve the availability, performance and reliability of power supplies in the capital, Baghdad.

ABB will upgrade the existing control center with an integrated solution comprising its Network Manager SCADA DMS (supervisory control and data acquisition distribution management system) software, now a part of its Ventyx portfolio. ABB will also supply the communications equipment and RTUs (remote terminal units) to control and monitor power supplies in this densely populated area of the country.

The refurbished control centers will provide operators with a system-wide view of conditions in the distribution grid, enabling smooth operations as well as rapid detection and correction of faults. The scope of the project includes operator training.

“The refurbishment of the distribution system with advanced monitoring and control capabilities, will help improve availability and quality of electricity for consumers and support economic development in the region,” said Jens Birgersson, head of ABB’s Network Management business unit, a part of the company’s Power Systems division. “Our unique ability to facilitate the integration of operational and information technologies provides a multicomponent system from a single source, reducing both cost and complexity for our customers.”

The project is one of the several infrastructure improvement initiatives currently underway in Iraq and part of reconstruction efforts to establish a dependable power network to support economic and social development in the country.

ABB (www.abb.com) is a leader in power and automation technologies that enable utility and industry customers to improve performance while lowering environmental impact. The ABB Group of companies operates in around 100 countries and employs about 135,000 people.

(Source: ABB)

The Turkish company Çalık Enerji will open its 250 mega watt Khairat power station at the beginning of July, the first of 20 stations Iraq hopes to build around the country, reports AKnews.

The Deputy Prime Minister for Energy, Hussein al-Shahristani, made the announcement today and told AKnews that the Ministry of Oil will provide fuel for the plant, located in Karbala, southwest of Baghdad.

About the measures taken to address the electricity crisis during the summer, Shahristani said "the ministry will install 20 stations in different parts of the country, and the capacity of each one will reach up to 250 MW."

Iraq needs at least 14,000 MW to meet the high demand for energy but currently has less than 7,000 MW.

(Source: AKnews)

AKnews reports that Iraq will stop importing electricity from neighboring countries by the summer of 2013.

Instead of depending on foreign countries for electricity, new capacity will be introduced over the next two years to the national grid, and energy production will reach 20,000 MW.

Ministry spokesman Musab al-Mudarres told AKnews the ministry currently has 20 projects to build new electricity power plants, and estimated that this has been 60-80 percent completed.

"The total electric power in Iraq will reach 9,000 MW next summer and new units to generate electricity will be added every three months to the national system", he added.

Mudarres did not rule out exporting electricity to neighboring countries in the coming years.

The Iraqi Electricity Ministry signed a contract with the Turkish company Çalık Enerji last January to build the 1,250 MW Khairat power station.

(Source: AKnews)

The United Nations Development Programme (UNDP) and Shell Iraq have signed an agreement to implement a range of development projects in Southern Iraq. The four year partnership aims to increase the number of local area development activities, promote local small and medium enterprises and provide vocational training to respond to the private sector’s needs.

“UNDP believes that such partnerships are fundamental for the effective implementation of our development programmes in Iraq” said Peter Batchelor, UNDP Iraq Country Director. “Partnering with the private sector, particularly with international oil companies who are the largest investors in the country, is key to capacity building, generating employment and building strong and competitive inclusive markets” he added.

The partnership, the first between UNDP Iraq and the private sector, has two main components. The first includes vocational training to equip existing and future Iraqi workers to respond to the needs of the oil and gas sector. It also includes providing support for the establishment and development of micro, small and medium enterprises. The second includes a range of programmes to improve the quality of basic services for the residents of Basra province. This will be achieved through more inclusive and participatory planning processes, where local communities and civil society organisations are able to identify their own development needs and priorities.

Unemployment in Iraq is currently 11.5% of the labor force, slightly less than in recent years. More than 20% of Iraqi youth are unemployed, while at least one in every five women participating in the labor force is unemployed. In the Basra governorate, unemployment is 11 %.

Shell has announced that it has granted a $63 million contract to build an electricity generation plant for its gas capture project southern Iraq to Swiss engineer ABB Ltd.

Jasser Hanter, general director of the Shell gas project, told reporters that ABB will build two 25 megawatt power plants at Khor al Zubair.

The $17 billion Basra gas project led by Shell and Mitsubishi aims to harvest natural gas that is now flared off by Iraq's oil production and use it to generate electricity.

(Source: Reuters)

The U.S. Department of State’s Office of Iraq Affairs has hosted a Doing Business in Iraq Workshop in Washington, D.C, where over 100 U.S. businesses interested in all sectors of the Iraqi economy registered.

The workshop is part of a larger initiative that aims to engage, educate, and support U.S. businesses as well as provide information on the business climate, risk factors, and upcoming business opportunities in Iraq. It is intended to broaden the pool of U.S. businesses interested in the Iraqi market.

Speakers included the Iraqi ambassador, officials from the Department of State, the Department of Commerce, the Overseas Private Investment Corporation, the Export Import Bank, and U.S. diplomats in Iraq via live video feed from three locations. The various presentations addressed upcoming business opportunities, information on relevant Iraq legislation, and financing options.

There was a particular focus on the near term priority areas for Iraq: electricity, transportation, public works, water and oil The Government of Iraq has allocated $32 billion of its 2012 budget for public investment.

This workshop, beyond building the economic agenda with Iraq, is part of Secretary Clinton’s Jobs Diplomacy effort, a series of actions that are part of the Economic Statecraft agenda focused on promoting American businesses abroad. Building upon Deputy Secretary Nides’ June 2011 Business Forum on Iraq, Department economic officers have met U.S. businesses potentially interested in the Iraqi market and successfully encouraged over 30 U.S. businesses to participate in the first American pavilion at Baghdad International Trade Fair in 20 years. Moving forward, similar workshops will be held for U.S. businesses, with both webinars and workshops for specific sectors.

The State Department will continue to work on extending U.S. business ties with Iraq as well as supporting the business promotion efforts of the U.S. Department of Commerce.

While Iraq has experienced significant economic growth over the last several years, efforts to rebuild its economy are still in the early stages. Business engagements like these are one way to ensure Iraq’s economy continues to recover from war and isolation and that U.S. businesses are aware of and able to benefit from new opportunities in Iraq.

(Source: US Embassy)

Iraq's cabinet has approved a $363 million (435 billion Iraqi dinar) contract on Tuesday with Egypt's Orascom Construction to build a 1,014 MW gas-fired power plant in the northern town of Baiji [Beiji, Bayji].

The contract involves building the plant and installing six 169 MW generators which Iraq bought from Siemens in 2008.

The project is expected to be completed within 21 months, Musab al-Mudarres [Musaab al-Mudarris], a spokesman at the electricity ministry, told Reuters.

Iraqi demand for electricity peaked at 15,000 megawatts last year, but the oil-producing nation managed to supply less than half of that.

(Sources: Reuters, Aswat al-Iraq)

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.

It took even longer than last year, but the Iraq annual budget finally passed in parliament today with a solid majority.

Many aspects of the budget are similar to last year, with small increases to all the main posts, roughly following the draft that was introduced in December 2011. The big money still goes to the central government and Kurdistan, with some added perks for the ordinary governorates. It is noteworthy that spending on electricity is sharply up compared with 2011, which must be a good sign.

Some special features of the last-minute changes to the original draft call for comment.

The Sadrists had demanded a petrodollar scheme by which a portion of Iraqi oil revenues would go directly to Iraqi citizens. This idea has indeed been included and was celebrated by the Sadrists as a win for their leader Muqtada. However on closer inspection it seems the money that will actually go to the citizens is whatever surplus is left after deficits have been covered, meaning that unless the oil price increases enormously, there may not be that much money to distribute after all.

Money has also been specifically guaranteed for the sahwa pro-government militias in Diyala and Nineveh. This is a response to a demand from the Wasat sub-bloc of the Iraqiyya coalition, and some parliamentarians suggested it constituted the main concession by the government in obtaining Iraqiyya support for the budget.