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The electricity, trade, defense and interior ministries have been identified as the most corrupt of the country's ministries, the Integrity Committee in parliament.

Iraq's Integrity Commission has announced that it has opened an investigation into corruption in the Iraqi Defense Ministry

AKnews reports that the investigation relates to all of the department's dealings since 2003, especially relating to the purchase of arms.

Committee member Aziz al-Ukaili told the news agency that the Commission is unable to follow up all of the cases of corruption in all ministries, since the ministries include “persons that can be hardly detected."

The 2010 corruption index published by Transparency International put Iraq third from bottom in the perception of corruption.

Earlier this year, Iraqi authorities arrested a high-ranking police official in connection with the purchase of "ADE651" bomb detection devices, purchased from a British-based company, which were described as practically useless.

(Source: AKnews)

The Deputy Prime Minister for Energy Affairs, Hussein al-Shahristani, has been nominated to the post of Acting Minister of Electricity, along with his current post, the semi-official Iraqiya TV Satellite Station reported on Wednesday.

“Prime Minister, Nouri al-Maliki, has assigned his Deputy for Energy Afffairs, Hussein al-Shahristani, to hold the administration of the Minister of Electricity on an acting basis,” the TV Station said, according to Aswat al-Iraq.

Prime Minister Maliki had sacked his Electricity Minister, Raad Shallal, on August 17, following the exposure of questionable contracts for electricity generation, valued at $1.7 billion.

(Source: Aswat al-Iraq)

An Amman-based freight company has won a tender to transport 30,000 metric tons of fuel oil per month from Iraq to Jordan, the nation’s official news agency Petra said.

Bloomberg reports that the company is called 'Mahmoud Al Zoubi for Transport', and that it will charge 37.3 Jordanian dinars ($52.65) per ton, which was the lowest price offered in the tender.

The fuel will be used to generate electricity at the Aqaba Thermal Power Station in the south of Jordan.

Iraq agreed in June to increase daily oil exports to Jordan to 15,000 barrels from 10,000 barrels and supply its neighbour with 30,000 tons of heavy fuel, following attacks on the gas pipeline into Jordan from Egypt.

(Source: Bloomberg)

The Iraqi Electricity Ministry has said that a third Turkish ship will arrive within a few days in the Umm Qasr port (pictured) to supply 108 megawatts of power to Iraq's struggling electricity grid.

A spokesman for the ministry has added that two other Turkish floating power plants off southern Iraq supply a total of 180 megawatts to the country.

(Source: AME Info)

Iraq's Ministry of Electricity said on Wednesday that it had received bids by three foreign companies to build a 1,014 megawatt gas power plant in the town of Taji, 20 km (12 miles) north of Baghdad.

Reuters reports that South Korea's Hyundai Engineering & Construction bid at around $500 million, Egypt's Orascom Construction at $463 million, and a Chinese company offered a bid at $337 million.

The contract is to build a plant with 6 gas units, each with a capacity of 169 MW, which Iraq bought from Siemens in a contract signed in 2008.

"The sums which the companies offered are considered initial figures, they can be negotiated," the ministry said.

(Source: Reuters)

A Jordanian transport company said on Sunday that it won the 'technical side' of a bid to transport 10,000 tons of fuel oil from Iraq to Jordan every day, within an agreement signed between the neighbouring countrries in 2006, according to the KUNA news agency.

Abdussalam Al-Theyabat, owner of the Theyabat Transport and Trading corporation, said his company and two others had passed the technical stage of the bid which included transportation of around 360,000 tons of heavy fuel oil every year from the Beiji [Bayji, Baiji] refinery in Iraq to the Aqaba Thermal station at the Red Sea.

Speaking to KUNA, Al-Theyabat said a government committee would soon open envelopes to see which company had offered the lowest price.

He explained that the heavy fuel oil would be used to generate electricity to replace Egyptian natural gas. Explosions at gas pipelines in the Egyptian border city of Al-Arish have increased Jordan's energy bill by 20 percent in 2011.

Iraq sells oil to Jordan with preferential prices, or USD 18 per barrel less than oil markets. Iraq also sells every ton of heavy fuel oil to Jordan with USD 88.

(Source: KUNA)

The latest scandal at Iraq’s ministry of electricity involves multi-billion dollar “phantom deals” with a German and Canadian company. The minister of energy has been asked to resign. But according to a report from NIQASH, the real story is not as simple as it first appears.

As a long, hot summer continues to overheat the citizens of Baghdad, one of the government ministries that could alleviate some of their pain is in the spotlight once again. With the latest scandal at the Ministry of Electricity, which will most likely result in the dismissal of the current minister, it seems that this government department deserves to sit atop the list of most corrupt government institutions in Iraq.

Despite an ever-changing roster of ministers since the new Iraqi government was formed in 2003, nothing has really changed in terms of electricity supply in Iraq. Most Iraqis still only get a few hours of electricity a day, most local power is currently supplied by the independent owners of generators and Iraqis continue to suffer without their refrigerators and air conditioning in the 50 centigrade-plus summer heat. In fact, during popular protests earlier in the year, a better electricity supply was one thing all the crowds demanded.

Those earlier protests saw the resignation of Karim Wahid the former minister of electricity. And now, after only six months in the job, the next minister also appears to be being forced out of this difficult job.

The latest scandal involves what are coming to be known as the “phantom deals”. How much of the deals really are phantoms and how much is real still appears to be up for debate.

Early in July the Electricity Minister Raad Shalal signed two deals, worth close to US$2 billion in total, for the building of power plants and infrastructure. According to some politicians though, the companies he signed the deals with did not actually exist. One of the companies was a German one, Maschinenbau Halberstadt (MBH) and the other was a Canadian firm, the Canadian Alliance for Power Generation Equipment Inc (CAPGENT).

MBH was awarded a contract worth US$623 million to build five power plants in the Ninawa province within a year’s time. Capgent’s contract was for just over US $1.2 billion and they were assigned to build ten power plants in Iraq in the provinces of Anbar and Salaheddin, also within 12 months.

This article was written by Abeer Mohammed, and was originally published by the Institute for War and Peace Reporting, iwpr.net. It is reproduced by Iraq Business News with permission. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Iraq may face a major housing crisis in the next few years unless it takes steps to encourage foreign investment in the construction of homes for the growing population.

The government, it seems, needs to battle corruption, bureaucracy and improve security in order to complete a development plan, designed back in 2006, that envisages the construction of two million housing units.

In 2006, Iraqi’s ministry of construction and housing announced it would pay for 300,000 housing units while, due to budgetary constraints, foreign investment funds would be sought for the additional 1.7 million units – all to be built by 2016.

Out of the 300,000 units, only 7,000 have been built so far with a final completion date for the rest set for either 2017 or 2018, two years behind schedule, Istebraq al-Shauk, senior deputy minister for construction and housing, said.

Meanwhile, around 20 per cent of Iraqis are either squatting, homeless or at risk of being made homeless, although exact figures are unavailable, Abdul Zahra al-Hindawi, spokesman for the Iraqi central bureau of statistics, said.

Building affordable housing units was one of the key demands made by Iraqi protesters in demonstrations throughout the country in February.

Last year, in a move interpreted as an attempt to attract foreign investors, parliament passed a law regulating investment procedures in Iraq, with the accent on curbing corruption and red tape.

Najaf Provincial Council has made a preliminary agreement with a Chinese company for it to build a power station, the head of the energy committee in Najaf told AKnews.

He said the $79 million [95 billion Iraqi dinars] oil-fired station will have a capacity of 100 megawatts.

According to AKnews, the agreement came after the Chinese National Electricity Company presented an offer to the council whereby the council would pay the costs in instalments over five years.

The new plant could ease Najaf's electricity shortfall, as the 100MW plant will provide 25% of the province's power. The company has committed to assume operation and maintenance of the station for three years.

To produce 100MW the station will require 55,000 liters of fuel per day, a quarter of the output of Najaf refinery.

"The station will be built near the refinery for the ease of transporting the fuel," Bilal said. "The company will complete the project in six months and it is expected to operate next summer"

(Source: AKnews)

In an effort to rebuild its ailing industrial sector, Iraq has relaunched a tender to rehabilitate 18 of its idle factories, for the second time this year, after failing to attract enough interest from foreign investors.

Reuters quotes Abdul-Ghani Fakhri, director general of the investment department at the Ministry of Industry and Minerals, as saying that investors continue to shy away from Iraq due to shaky security and low profitability.

The ministry is sweetening the terms for foreign investors bidding to rehabilitate state-run factories by offering discounts on electricity and fuel, banning the importation of competing goods from outside Iraq, and paying half of the wages of the Iraqi employees working in the factories, said Fakhri.

"The companies are afraid to come here ... and this type of investment is still a new idea in Iraq," he said, "but I think we are heading in the right direction."

Iraq has managed to strike deals with foreign investors to rehabilitate a number of its cement and fertilizer factories, but failed to attract them to other sectors.

One of the reasons behind the lack of interest from foreign investors is the ample supply of cheap imported goods, which made the investors doubt the profitability of the projects, Fakhri told Reuters.

Other reasons are the factories' old machinery and equipment, the huge number of workers being employed by the state and security concerns, he said.

Many of Iraq's 240 factories were looted in the aftermath of the 2003 invasion, or are outdated or located in areas still controlled by Islamist insurgents. Sectors open for investment range from construction, engineering, petrochemicals and fertilisers to food, drugs and textiles.

France's Lafarge , the world's largest cement maker, was one of the early movers into Iraq, taking on renovation of cement factories.

The plants offered for bidding include glass and ceramic factories with a total estimated renovation cost of $70 million in the vast western Anbar province, and a car tyre factory in the southern Najaf province for $111 million.

They also include four medicine factories in the Nineveh and Salahuddin provinces with a total estimated cost of $70 million. Two paper factories in Basra and Missan provinces were estimated at $197 million.

The closing date for bids is Sept 7, according to an official statement by the ministry. The deals are production-sharing, the statement said.

(Source: Reuters)