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By John Lee.

General Electric (GE) is reportedly expected to win a large share of the multibillion-dollar contracts to rebuild Iraq’s electricity system.

According to a report from Reuters, "under U.S. prodding, Iraq is asking both Siemens and GE to bid on contracts and expects to make awards to each of the companies".

Following a hotly-contested competition last year, it was agreed that Siemens and GE would share the work to upgrade the system, with GE supplying 14 gigawatts (GW), and Siemens 11 GW.

The Financial Times subsequently reported that the deals were not certain to be approved.

(Source: Reuters)

By John Lee.

The Trump administration has reportedly granted Iraq a 120-day waiver from its sanctions against Iran, to allow it to continue importing electricity from the country during the hottest of the summer weather.

The decision followed a phone call on Friday between Secretary of State Michael Pompeo (pictured) and Iraqi Prime Minister Adel Abdul Mahdi.

The State Dept said it is continuing to work with Iraq to end its dependence on Iranian natural gas and electricity.

(Sources: Bloomberg, The National)

By John Lee.

Prime Minister Adil Abd Al-Mahdi has met with German Foreign Minister Heiko Maas and his accompanying delegation during a visit to Baghdad.

The Prime Minister expressed his desire to deepen relations with Germany, and cited in particular the signing of a road map for the electricity sector with Siemens.

Minister Maas expressed German concern for stability in the region, and said he will visit Iran in the coming days to discuss this issue.

(Source: Office of the Prime Minister)

US-based Capstone Turbine Corporation (Nasdaq: CPST) has announced today that it has secured an order for two C600 Signature Series microturbines to provide 1.2 megawatts (MW) of energy to power a triethylene glycol (TEG) dehydration facility in the Basra region of Southern Iraq.

The order also includes Capstone’s new self-cleaning pulse filtration system which will allow the microturbines to endure the remote and sandy conditions with minimal maintenance. The order was secured by Technical Solutions to Industry FZE (TSI), Capstone’s authorized distributor to Iraq and United Arab Emirates (UAE).

Fueled by available raw gas, Capstone’s two C600S microturbines will power 100% of the new dehydration facility. The new facility is part of a larger 25-year joint venture between local gas and leading oil producer’s efforts to capture, treat and monetize associated gas currently being flared from three southern Iraq oilfields.

Capstone recently developed a new line of self-cleanable severe environment air filtration systems for its Signature Series line of microturbine products to facilitate its expansion into the oil and gas business in the Middle East as part of its overall double digit revenue growth strategy.

The company announced its intentions to expand its business into the Middle East a couple of years ago and has previously delivered successful projects in Oman, Qatar, Saudi Arabia and the UAE. Capstone expects that higher oil prices and the move towards reduced gas flaring will continue to drive demand and should provide a positive backdrop for Capstone’s low emission microturbine solutions.

Darren Jamison, President and Chief Executive Officer of Capstone, said:

“Flaring is the traditional way to dispose of unwanted gas produced during oil exploration activities, but the long standing practice creates an immense amount of carbon dioxide emissions and adds to climate change.

“In Iraq alone, 16 billion cubic meters (bcm) of natural gas is flared annually, making it a wasted resource that could instead provide electricity or other benefits to meet the predicted doubling demand by 2030.”

Iraq is one of the world’s biggest energy producers and is set to become the fourth-largest oil-producer by 2030 behind the United States, Saudi Arabia and Russia according to the IEA report, Iraq’s Energy Sector: A Roadmap to a Brighter Future 2019.

At the same time, 60-70% of gas produced is being flared due to the lack on infrastructure causing Iraq to import natural gas from the neighboring country of Iran. To improve efficiency and help with shortfalls due to rising electricity demand, the Iraqi government is working with international gas companies to capture and utilize its resources versus flaring.

Jim Crouse, Executive Vice President of Sales and Marketing for Capstone, said:

“As pressure for more efficient and environmentally conscious oil and gas production increases, we continue to see an increased demand for microturbines for flare reduction applications.

“Capstone, through its distributor network, is committed to do its part by educating and working with producers and local operators for a more profitable production. Flare reduction applications like this in Basra can have a payback as short as one year which makes it an economic win as well as an environmental win.”

(Source: Capstone)

GE Power (NYSE: GE) has installed and commissioned a new advanced 9E gas turbine at the Iraqi Ministry of Electricity’s (MoE) Al Qudus Power Plant.

The site was previously capable of generating up to 1,125 megawatts (MW) of power. With the addition of the new turbine, it can generate an additional 125 MW, which will contribute to meeting the higher demand for power during the summer months. GE is also providing maintenance services, parts and rehabilitation works at the site, helping to enhance the reliability of operations at the plant and maintain a stable supply of electricity over the course of the year.

Musaab al-Mudarris, Director of the Media Department of the Iraqi Ministry of Electricity said:

“Delivering additional power for the hot summer months is a priority for the Ministry of Electricity. One of the quickest and most cost-effective means of adding efficient, reliable power to the national grid is to enhance the productivity of existing power generation facilities.

"GE can help us meet this objective with its industry-leading solutions, large installed base of power generation equipment across Iraq and local team of experts. The successful delivery, installation and commissioning of a new gas turbine at Al Qudus Power Plant just 5 months after the contract was awarded is a testament to the Ministry and GE’s joint commitment to powering Iraq.”

GE’s 9E technology is capable of running on more than 50 different kinds of fuel. This provides the MOE with the flexibility to operate the unit on the most economical source available and to keep generating power using liquid fuels when gas is unavailable.

Joseph Anis, President and CEO of GE’s Gas Power Systems and Power Services businesses in the Middle East and South Asia, said:

“GE is committed to delivering reliable, efficient and affordable power to help the Iraqi people strengthen their economy, re-build conflict-affected areas and support progress for present and future generations. Our teams were among the first to enter Mosul after its liberation, helping to rehabilitate the Al Qayara power plant; we are supporting the development of the country’s largest power plant in Baghdad province; and we have facilitated the Ministry of Finance to unlock over $2 billion of funding for the power sector.

"We have a strong, successful track record of delivering results under the toughest of conditions across Iraq and remain committed to building upon this legacy.”

GE employs up to 300 people in Iraq, more than 90 percent of whom are Iraqi nationals, and has supported the development of Iraq’s energy sector for more than 50 years. From Zakho to Basra, GE-built solutions are helping to enable growth, health, connection and safety in communities across Iraq.

Today, GE-built technologies contribute up to 55 percent of Iraq’s current electricity production, GE and its partners power more than 90 percent of the aircrafts operated by Iraqi Airways and nearly 4,000 GE Healthcare products are deployed in hospitals and clinics across Iraq.

(Source: GE)

By Mustafa Saadoun for Al Monitor. Any opinions expressed here are those of the author and do not necessarily reflect the views of Iraq Business News.

US grants Iraq reprieve to continue buying Iranian gas

The United States has decided to grant Iraq a third 90-day sanctions waiver so it can continue to purchase gas from its sole provider, Iran, giving Baghdad some much-needed breathing room.

On May 22 in Baghdad, Joey Hood, US chargé d'affaires in Iraq, stressed to reporters that the waivers will not continue indefinitely, so the United States is working with Iraq to reduce its dependence on Iran.

Click here to read the full story.

Washington has exempted Baghdad from some of its unilateral sanctions against Tehran, allowing Iraq to continue importing energy from Iran, according to the US envoy to Baghdad.

Baghdad can now buy energy from Iran, US charge d’affaires Joey Hood told reporters on Wednesday, Iran's Press TV reported.

The waiver will allow Iraq to continue buying gas and electricity from Iran.

The administration of US President Donald Trump said in March it was extending a 90-day waiver for the second time to let Iraq continue energy imports from Iran.

The US envoy did not explain whether he was referring to the same waiver Washington gave Baghdad in March or he was declaring the issuance of new exemptions.

Gas imports from Iran generate as much as 45 percent of Iraq's 14,000 megawatts of electricity consumed daily. Iran transmits another 1,000 megawatts directly, making itself an indispensable energy source for its Arab neighbor.

Iraq and Iran share a 1,400-kilometer-long border. For their run-of-the-mill maintenance, Iraqis depend on Iranian companies for many things from food to machinery, electricity, natural gas, fruits and vegetables.

(Source: Tasnim, under Creative Commons licence)

The Rumaila oilfield produced 1.467 million barrels per day (bpd) in 2018 – the oilfield’s highest annual rate of production for 30 years. 2018 also saw the milestone of four billion barrels of oil produced since the Rumaila Operating Organisation [ROO] began operating in June 2010.

The results were reported in the 2018 Rumaila Annual Report, submitted by the Basra Oil Company (BOC) to the Iraq Ministry of Oil.

In accordance with BOC’s objectives, Rumaila continued its journey to becoming a more advanced oilfield in 2018. New infrastructure played an important part in the year’s success, with three major projects completed that help Rumaila’s capacity to produce its current high production rates, as well as contribute to securing the field’s long-term future.

The new Rumaila Power Plant began operating, providing 150,000kW of electricity to the Iraq National Grid and supporting Rumaila facilities; three new dehydrator and desalter production trains were commissioned – increasing production capacity by 124,000 bpd; and two degassing facilities installed new large-scale ‘free water knock out’ vessels that ensure oil quality remains high by stripping water from the hydrocarbons.

The introduction of new technologies continues to play a vital role in the field’s advancement. In 2018, this included: the further expansion of the ‘digital oilfield’ (with 2,000 digital sensors now providing instant data from wells, facilities and manifolds to guide production performance), the completion of a field-wide TETRA radio communications infrastructure, and new data analytics tools and frameworks that visualize, interpret and reveal meaningful insights to improve day to day working.

Underpinning the 2018 results has been the ongoing programme to drill new wells, optimize existing wells, and the injection of industrial-use water to restore pressure to reservoirs in the north of the field. Thanks to the water injection programme and its supporting operations, Rumaila has been able to produce oil from historically harder to access reservoirs: in 2018, the oil produced from the Mishrif reservoir was more than triple the amount of oil extracted from that reservoir in 2010 and generating results never previously achieved at the oilfield.

The 2018 Annual Report also highlighted:

• 59 Iraqi contracted companies won 85 contracts worth $650 million
• 220,181 training hours were delivered to Iraqi staff
• 31 new wells were drilled
• 23.5km² of land was cleared of unexploded ordnance
• 206,675m² of land was remediated
• $5 million spent on supporting Iraq’s oil and gas industry via the Rumaila Education Fund

Rumaila General Manager, Hussein Abdul-Kadhim Hussein, commented:

“2018 was a remarkable 12 months in the 70-year history of this oilfield, as well as another exceptional year for the Rumaila Operating Organisation. The partnership goes from strength to strength: our success derives from the way BOC, BP and PetroChina continues to operate as one integrated team.”

BOC Director General, Ihsan Ismael, said:

“On behalf of BOC, I’d like to thank every single BOC staff member who has ensured that Rumaila continues to deliver successful oil production for Iraq, as well as pay tribute to the support of our partners, BP and PetroChina.”

ROO Deputy General Manager, Julian O’Connell, said:

“Rumaila is in service to Iraq. Our objective is to provide oil to support Iraq today, as well as create a legacy for the future. Our strategy and programme for field rejuvenation and training Iraqi personnel is helping us to achieve these twin goals and to overcome the multitude of challenges Rumaila faces.”

Rumaila Special Deputy General Manager, Fan Jianping, added:

“We are very pleased to report another successful year at Rumaila. Equally important is the fact that we have achieved this within a safe working environment. We of course want to increase production, but we also want Rumaila to be the pride of Iraq, which can only be achieved by having safety as the number one priority.”

(Source: Rumaila Operating Organisation)

By John Lee.

Iraq's Minister for Electricity has warned of the dangers of politicising the problems in the country's electicity sector.

Luay al-Khateeb told AFP:

"Electricity is a national security issue ... In the end, any political, economic or security crisis in Iraq will affect the whole region -- and the global economy will be open to threat. We're urging for this file not to be politicised."

The shortage of electricity in the summer months, when people rely on air conditioning to keep cool, has been a source of social unrest in the past.

Khateeb added:

"On October 25, the week I took office, electricity generation sat at between 9.5 to 10 GW. It is now at 15 GW. [Most Iraqi provinces] will receive no less than 20 hours of electricity per day. This, to be honest, is a level of production the country hasn't seen in years."

(Source: AFP)