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By John Lee.

Lukoil President Vagit Alekperov has said that his company has invested $6 billion dollars so far on operations in Iraq.

At a meeting with Iraqi Oil Minister Adel Abdul-Mahdi [Adil Abd al-Mahdi] in Baghdad, Alekperov said:

"Lukoil is now working on geological exploration projects with other foreign companies in the 10th exploratory area ... I believe the appropriate circumstances were made for investing in Iraq that guarantees the rights of the investors."

First oil was produced from Lukoil's West Qurna in March. The company, Russia's largest private oil company, signed a contract revision in June to build two 75-mile pipelines and associated infrastructure.

(Sources: UPI, Ministry of Oil)

By John Lee.

Lukoil president Vagit Alekperov (pictured) is to meet Iraq's Minister for Oil, Adel Abdul-Mahdi [Adil Abd al-Mahdi], to discuss the expansion of the company's operations in the country.

The head of the Russian oil company told journalists:

"I will be in Baghdad on October 13 to meet the oil minister. I hope, we will continue our talks on the expansion of our operations in Iraq."

Lukoil currently has a 75 percent stake in Iraq's giant West Qurna-2 oil field in Iraq, and has the right to further develop and explore Block 10, which lies 120 kilometers to the west of Basra.

The company is also believed to be considering a joint venture with Russian state-owned exploration and production company Zarubezhneft to develop the Nassiriya oil field and help build an associated refinery.

(Source: RIA Novosti)

By John Lee.

Rudaw reports that Russia's Gazprom Neft has been forced to halt operations at its Halabja block following demonstrations by hundreds of protestors from 34 villages around the town of Darbandikhan.

According to the report, the protesters have given the oil company until 20th October to stop all exploration activity, claiming that “scientific evidence shows work conducted by this company is lethal and damages the environment, air, water wells and springs - and such changes are irreversible.”

They also demand that all oil companies leave the region and that the Kurdistan Regional Government (KRG) drop its drive for independent oil exports, insisting that it should focus instead on tourism and agriculture.

Gazprom Neft is involved in three projects in the Region - Shakal, Garmian and Halabja - and estimated geological reserves for all three are more than 1.3 billion tonnes of oil. In the Halabja block, the company is conducting geological surveys.

(Source: Rudaw)

By John Lee.

In its interim management statement issued on Tuesday, Russian-based HMS Group said that since the start of this year it has signed several contracts for business in Iraq.

The contracts, which it values at about 1 billion rubles ($25 million; 29 billion Iraqi dinars), were signed with Russian and international oil and gas majors.

The deals are for the supply of water injection pumps, booster pumps, upstream process equipment and a contract for the provision of short-term repair services, refurbishment and supply of pumps and auxiliary equipment.

(Source: HMS Group)

At an international conference in Paris, the five permanent members of the U.N. Security Council, representatives of European and Arab states, and representatives of the EU, Arab League and United Nations, have all pledged to help the government in Baghdad fight against Islamic State militants.

The full statement from the French Ministry of Foreign Affairs is shown below:

Communiqué from the Ministry of Foreign Affairs and International Development

Paris, September 15, 2014

1. At the invitation of the President of the French Republic and the President of the Republic of Iraq, an international conference on peace and security in Iraq was held today in Paris.

2. The conference participants (Bahrain, Belgium, Canada, China, the Czech Republic, Denmark, Egypt, France, Germany, Iraq, Italy, Japan, Jordan, Kuwait, Lebanon, the Netherlands, Norway, Oman, Qatar, Russia, Saudi Arabia, Spain, Turkey, United Arab Emirates, United Kingdom, United States of America, Arab League, European Union, United Nations) expressed their commitment to the unity, territorial integrity and sovereignty of Iraq. They welcomed the formation of a new government under the authority of the Prime Minister, Mr Haïdar al-Abadi, and offered him their full support to strengthen the rule of law, implement a policy of inclusiveness, and ensure that all components are fairly represented within the federal institutions and all citizens are treated equally. All of these measures are necessary in order to successfully combat Daech (ISIL) and terrorist groups, which represent a threat to all Iraqis.

3. The conference participants asserted that Daech (ISIL) is a threat not only to Iraq but also to the entire international community. They condemned the crimes and acts of mass violence that Daech (ISIL) commits against civilians, including the most vulnerable minorities, which may amount to crimes against humanity. They agreed to cooperate and do everything to ensure that the culprits are brought to justice. They confirmed support for the inquiry led by the Office of the High Commissioner for Human Rights to that end.

By John Lee.

Russia's Gazprom Neft, the operator of the Badra oil field (pictured) in Iraq, has announced that first oil from the field is now being delivered to Iraq’s main pipeline system for transfer to the export terminal in Basra, on the Persian Gulf.

Current deliveries from Badra to the pipeline stand at over 15,000 barrels of oil per day and this level should be maintained until the end of 2014.

According to the service contract with the Government of Iraq, the consortium of investor companies will begin receiving a share of the oil produced at the field after a period of 90 days following launch of commercial supply.

All of the oil produced in southern Iraq, including at Badra, is Basrah Light oil. The Iraqi State Oil Marketing Organization (SOMO) is responsible for oil sales and each quarter will be delivering a share of oil to the investor companies to reimburse their initial project costs.

Once these project costs have been covered, the investor companies will receive remuneration in kind for ongoing development at the rate of $5.5 of oil per barrel produced. Each investor company will be selling their share of oil independently.

First oil from the Badra field was produced in December 2013. Final commissioning at the field and testing of production and transportation infrastructure began in May 2014. Two wells are currently in production at the field and a further three wells are being drilled under a contract with the Chinese company ZPEC. According to the service contract production at the field will achieve 170,000 barrels of oil per day.

Alexander Dyukov, Chairman of the Management Board of Gazprom Neft, said:

"Over the period of just a few years, a consortium of companies led by Gazprom Neft has fully prepared Badra, one of the most complex geological field structures in Iraq, for full-scale commercial development.

"This is the first major international project in upstream the company has implemented from scratch. The unique experience gained during this project will contribute to our development of future projects both in Russia and internationally".

The field is being developed by Gazprom as lead partner (30% stake), along with Korea’s KOGAS (22.5%), Malaysia’s Petronas (15%), Turkey’s TPAO (7.5%), and Iraq (25%).

(Sources: Gazprom Neft, KOGAS)

By John Lee.

China expert Simone Van Nieuwenhuizen has written an opinion piece for The Diplomat, a foreign affairs journal that covers events in Asia. She argues that it would be in China's interests to do more for Iraq.

In the piece, Van Niewenhuizen notes that not only has China been threatened by the Islamic State of Iraq and the Levant (ISIL) but also supports a UN Resolution condemning terror groups in Iraq and Syria and imports a significant amount of Iraq's oil.

But despite China's involvement in investment and reconstruction in Iraq, the Asian giant has so far avoided any counter-terror commitments currently being pursued by both NATO and Russia, among other countries with interests in the Middle East.

Van Nieuwenhuizen argues this situation may soon change if China wishes to safeguard her MENA region interests. Read the full piece here.

(Source: The Diplomat)

By John Lee.

Meeting an extended deadline, Iraqi President Fouad Massoum has nominated a PM from the State of Law bloc, the largest coalition which therefore has the constitutional right to name the next Iraqi PM.

But it was not Nouri-al-Maliki. Observers are now waiting to see what action, if any, Maliki might take to hold onto power. So far, MPs loyal to Maliki have alleged that the nomination of Haider al-Abadi (pictured) amounts to betrayal, and there has been talk of taking legal action.

Critically, The Washington Post has reported that it may have been Maliki's fiery speech on Sunday night which turned what was an increasing defection against the PM into a full scale political rebellion.

However, this may not be the last of it. Rumours have circulated that Maliki has attempted to secure key government infrastructure with loyalist Iraqi forces, although former foreign minister Hoshyar Zebari and US officials have indicated they are not expecting anything resembling a coup d'etat.

Maliki has faced what appears to have been a slowly building political rebellion over his handling of the recent crisis (and to many, the culmination of his confrontational style in recent years). He  is now experiencing what amounts to an informal vote of no confidence.

In his place is Haider al-Abadi, a politician who received his doctorate in electronic engineering at Manchester University, England. As expected, he is from Maliki's Dawa party and has a long service in the new Iraqi government behind him, having been an adviser to Maliki, the head of the parliamentary finance committee and the deputy speaker of parliament.

Abadi is an interesting choice, and has spoken in more moderate terms on a number of issues when compared to Maliki, conveying a more conciliatory tone towards both Sunnis (during the prolonged protests) and Kurds (regarding the oil dispute).

He also has extensive business experience garnered during his time with the Iraqi opposition in London, and has gone on record a number of times to speak about challenges facing Iraq including sectarianism and increasing the role of the private sector.

Crucially for Iraq at the current time, if Abadi can counter worsening sectarian relations and assure "fence sitting" Sunnis who have not yet joined the insurgency, the US may feel more confident extending military support to Iraq, something which could be of vital importance in defending critical infrastructure.

In foreign relations, Abadi will likely pursue a similar path to Maliki, keeping bridges with both Iran and the West, China and Russia.

However, Abadi faces two quite significant challenges, firstly putting together a new Iraqi cabinet in an increasingly fractured political scene, and secondly building national unity to fight the ongoing ISIS onslaught.

(Source: Various news agencies) 

By Patrick M Schmidt.

The Russian state-owned oil company, Gazprom, is expected to launch exploration operations in Halabja province before the end of the year.

The province is located in the region of the Kurdistan Regional Government (KRG) and lays close to the Iran-Iraq border.

If they find enough oil reserves, the company will begin normal drilling operations.

In exchange for drilling in the region, Gazprom would have to provide a number of social services to locals as well as offer opportunities for local students to study energy related disciplines in Russia each year.

(Source: Basnews)

Itar-Tass reports that Russia’s Defense Minister, Sergei Shoigu (pictured), intends to expand military-technical cooperation with Iraq.

The Minister is quoted as saying:

“Military-technical cooperation between our countries develops successfully. The intergovernmental agreement proves its efficiency.

“We’re meeting with the Iraqi officials when the country faces difficulties.

“We support your efforts in fighting terrorism.

“We seek to relations with Iraq. This is our strategic priority."

Iraqi Defense Minister Saadun Al-Dulaimi said:

“It is not a secret that now Iraq is facing difficulties. We’re fighting terrorism.

“Counter-terrorism is the priority of the world community. When we fight terrorism on our territory, we feel like we protect the world community.

“Now the Iraqi army needs weapons for continuing the fight."

(Source: ITAR-TASS)