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Gazprom Neft leads a consortium of investors in Iraq calling on the government to clear mines from the Badra oil field near the Iranian border.

Iraqi authorities report there are more than 27 million pieces of unexploded ordnance in Iraq from the war with Iran in the 1980s. The largest number of mine fields is near Badra in Wasit province.

Gazprom Neft said demining of the region was required to retrieve oil in the border region, Russia's state-run news agency RIA Novosti reports.

Reserves near Badra are estimated at around 2 billion barrels of oil and the project should cost around $2 billion, the report added.

Gazprom Neft, the oil division of energy monopoly Gazprom, leads a consortium along with KoGas from South Korea, Petronas from Malaysia and Turkey's TPAO at Badra.

Gazprom Neft under the terms of a 2009 agreement with the Iraqis will develop the Badra field in Wasit province for the next 20 years. Total capacity could reach 170,000 barrels per day.

Turkey last week strengthened its energy ties with Iraq by renewing a contract to import Iraqi oil to the Turkish Mediterranean Sea port of Ceyhan, where Azerbaijani oil also arrives via the Baku-Tbilisi-Ceyhan (BTC) pipeline. Earlier this year, it was announced that Iraq will export between 5 billion and 10 billion cubic meters per year of natural gas to Turkey for inclusion in the Nabucco pipeline carrying the fuel to Europe.

The oil will come from Kirkuk in Iraqi Kurdistan, along the route of the already existing 1,000 kilometer Kirkuk-Ceyhan oil pipeline. The pipeline, built in the late 1970s, consists of two trunks, with a combined design capacity of 1.6 million barrels per day, or more than half as much again as the BTC's design capacity.

The Kirkuk-Ceyhan pipeline was mainly empty from 2003, after the US overthrow of Saddam Hussein, until late 2007, and it has since been the target of disruptive attacks (most recently last November), besides suffering general disrepair as a result of the prewar UN sanctions and subsequent collateral damage. The German firm Siemens modernized the line in 2003 under the supervision of the Turkish firm BOTAS. Since re-entering service, it has operated at roughly one-sixth to, more recently, one-third of project capacity, when it has not been shut down for one or another reason.

Negotiations between Iraq and Turkey began last year, and agreement was reached after Turkish Energy Minister Taner Yildiz earlier this month expressed his wish to go ahead. Yildiz agreed with Iraq's deputy oil minister, Ahmad Al Shamma, concerning some changes to the existing contract, which expires at the end of this month. In particular, new transit taxes were agreed and provisions set for possible renovation, rebuilding or re-routing of the line.

The new Iraqi throughput from Kirkuk comes hard on the heels of the announcement three weeks ago that Turkish state firm TPAO is negotiating with the Iraq Southern Oil Company to drill 45 wells in the southern Rumaila oil field. That contract, which could be signed as early as this autumn, according to MEED, a business intelligence website, is worth US$318 million. The work would seek to almost treble field output to 2.8 million barrels per day, from 1 million.
Expansion of the Kirkuk-Ceyhan oil pipeline fits in with recently announced Turkish strategic plans to turn Ceyhan into a fully integrated oil hub over the next five years. Andalou News Agency reported on Tuesday that the country also intends to begin construction of a nuclear power plant by 2014, in addition to diversifying natural gas suppliers and raising the proportion of domestic-sourced power generation.

The government stated its intention to reduce its heavy dependence on Russian natural gas (due largely to the Blue Stream project, carrying gas from across the Black Sea to Turkey) while also constructing coal-fired and hydroelectric power plants to meet projected increases in domestic demand. That intention could be comprised, depending upon the conditions that Ankara allows to be set, upon construction and management of the gas storage facilities that Gazprom is building near Lake Tuz in central Anatolia. (See Iran claim clouds Turkey's energy goals, Asia Times Online, November 6, 2009).

Still, Turkey's announced plans would signify its intention not to be a consumer country for any of the gas transiting its territory from Russia through the projected "Blue Stream Two" project. They explain why, when Turkish Prime Minister Recep Tayyip Erdogan met Russian Prime Minister Vladimir Putin in Sochi 12 months ago, he argued strongly in favor of transforming Blue Stream Two into what is now called MedStream.

MedStream refers to a plan to conduct gas from Russia, after it crosses Anatolia from the Black Sea to Ceyhan, underneath the Mediterranean Sea to Ashkelon in Israel, with the cooperation of French companies.

It was once envisaged that gas from northern Iraq might be a candidate for re-export by Turkey along a MedStream route, before that gas became committed earlier this year to the European Nabucco project. The Russian gas might, after reaching Israel, go to South Asia by tanker, either through the Suez Canal or from the Gulf of Aqaba through the Red Sea and the Bab-el-Mandeb Strait between Eritrea/Djibouti and Yemen.

The Central Bank of Iraq is planning to rebase the Iraqi dinar but hasn't decided yet on the timing of the move, the bank said in a statement last week.  Affirms its commitment to its strategic projects, particularly knocking three zeroes from the Iraqi dinar," the statement said.

"Despite the technical and logistical preparations for the project we have yet to decide on suitable timing to implement the project," it said. Choosing a suitable time wouldn't be linked to economic aspects only, but rather to the security situation as well, it added.

“Most commercial Insurance Policies for Iraqi risks have monetary amounts in US dollars” comments Rob Edwards, Chief Operating Officer of AAIB Insurance Brokers.  “And this goes for sums insured, indemnity limits, deductibles and premiums, so there will be little effect for the majority of policies.”

If the rebase decision is taken it means a current 25,000 Iraqi dinar banknote will become IQD25, and a dollar will equal only 1.17 dinars.

Mr. Edwards continued, “Some policies written outside Iraq and the Kurdish Region of Iraq are for more modest sums insured, in particular auto exposures and these typically use Iraqi Dinar (ID) limits.  Underwriters and their reinsurers should keep a watching brief on this if they have policies with ID sums insured.”

Currency rebasing is usually monetarily neutral and is introduced to make commercial calculations easier and cheaper. Turkey, for example, knocked six zeroes off its lira currency in 2005. Russia did the same for its currency.

[Source: Zawya.  Full article here  http://www.zawya.com/Story.cfm/sidZW20100315000097/iq/?pass=1]

The LUKOIL-Statoil consortium could begin producing oil at the West Qurna-2 oil field in Iraq in 2013, LUKOIL Vice President Andrey Kuzyayev said. LUKOIL’s capital investments in the project could be as much as $3.7 billion, the Oil and Gas Information Agency reports.

LUKOIL President Vagit Alekperov said his company could increase investments in oil production in Russia and double production in its foreign projects. For the next three years, $3 billion has been allocated for LUKOIL’s foreign projects. K2K NEWS reports that LUKOIL intends to increase its oil and gas production to 446,000 barrels per day by 2015.

LUKOIL is currently involved in projects in West Africa, Venezuela and Saudi Arabia and is reviewing the possibility of beginning projects in Uganda and Kenya.

( Oil and Gas eurasia )

Russia's largest privately held oil company, LUKoil, plans to drill the first exploration well at the West Qurna-2 oil field in Iraq, LUKoil CEO Vagit Alekperov said on Wednesday. "We'll start drilling the first exploration well at the end of the year," Alekperov said, adding that the company's specialists were already working at the site.

On January 31, LUKoil signed a 20-year contract to develop Iraq's massive West Qurna-2 oil field. LUKoil will develop the 12.88 billion-barrel oil field in the Basra province in southern Iraq as a consortium with Norway's Statoil Hydro. The consortium, in which the Russian company holds 56.25% and Statoil Hydro 18.75%, won the tender for the oil field in December 2009. The Iraqi National Oil Company will also join the consortium and hold a 25% stake in the project.

LUKoil was involved in the development of the first phase of West Qurna and signed a contract with the Saddam Hussein regime to develop the second stage, but the deal was frozen in 2002. Alekperov earlier said that the international consortium led by LUKoil would invest some $30 billion in the development of the West Qurna-2 oil field.

Iraq’s oil sector is changing, and so could the identity of the man in charge.

Asked if he hoped to keep his post as the minister of oil in the next Iraqi government, Dr Hussain al Shahristani said he would be happy to step aside.

“I wouldn’t try to stay unless I was forced to stay. It wouldn’t be my wish,” Dr al Shahristani said before yesterday’s OPEC meeting.

Another imminent change will be Iraq’s tally of its oil reserves, which for years have been estimated as the world’s third largest, at about 115 billion barrels.

The estimate of proved reserves “is going to go higher”, Dr al Shahristani said. “We’re revising it now.”

In the past two years, foreign oil companies drilling in Iraqi Kurdistan have reported at least three world-class discoveries.

Canada’s Heritage Oil has struck an oil deposit that may contain as much as 3 billion barrels of recoverable crude.

Gulf Keystone, a Bermuda-registered company, estimates it has found at least another 1.5 billion barrels.

The Hungarian oil group MOL last week reported a significant oil find that analysts said might contain 1 billion barrels of crude.

In addition, a number of the world’s biggest oil companies have recently pored over data on Iraq’s main oil reservoirs as they prepared to bid for long-term service contracts to raise production.

Dr al Shahristani said Iraq was producing 2.5 million barrels per day (bpd) of oil and exporting more than 2 million bpd, making it the third largest OPEC oil exporter after Saudi Arabia and Iran.

In the next few months, Iraq could boost exports by as much as 100,000 bpd by restarting Kurdish crude exports that were halted last September in a long-running dispute over oil jurisdiction between the semi-autonomous regional government and Baghdad.

“We expect to resume exports from the Tawke field [in Kurdistan] shortly, within a month,” Dr al Shahristani said.

“The issue of exporting oil from those fields is a completely separate issue from the contracts that were signed.”

Within seven years, Iraq would increase its production capacity, although not necessarily its output, to 11 million bpd, the oil minister predicted. That could mean export capacity of up to 10 million bpd,www.ekurd.netrivalling that of the world’s top oil exporters, Russia and Saudi Arabia.

Iraq would not consider rejoining OPEC’s quota system until its output capacity had risen to 4 million bpd, possibly as soon as two years from now, Dr al Shahristani said.

Iraq is the only OPEC member without a production quota. It was granted an exemption to refurbish an oil sector ravaged by decades of war and mismanagement.

“Iraq is a founder member [of OPEC]. They have a right to develop their reserves,” said Abdulla el Badri, the OPEC secretary general.

“At the end of the day, we will accommodate Iraq for the sake of the Iraqi people. I am sure this will not be a problem for OPEC.”

08 March 2010 (Azzaman)

Russia’s Technopromexport has agreed to resume constructing a large power plant south west of Baghdad.

The al-Youssifya Power Station is one of the largest under construction in the country with an output capacity of 630 megawatts.

The Russians started work in 1990 and had to halt activities in 2003 due to U.S. invasion of Iraq.

But U.S. occupation troops occupied the plant and turned it into a military base, forcing the Russians to abandon the site altogether.

The Russian had completed nearly 35% of work on the plant when the Americans took it over.

U.S. troops are reported to have partially destroyed what the Russians had already done.

An Iraqi delegation was in Moscow last month, where it agreed with Technopromexport’s executives on terms to resume work at the plant.

Technopromexport, a Moscow-based firm, is a leader in construction of power projects and export of electricity.

Among its major power contracts in the country are the al-Hartha Power Station and other electricity projects.

The terms of the agreement have yet to be made public but the main hurdle for the Russians has insecurity.

Doha, 05 March 2010 (The Peninsula)

Middle Eastern mobile operators have outperformed their western counterparts for the first time, which have led to profitable growth and overseas expansion, a recent study shows.

PRTM, a global management consultancy firm, stated in their report "The Future of Mobile Telecommunications--New Operating Strategies for a New World," that seven multinational operators with origins in this region--Etisalat, Orascom, Qatar Telecommunications (Qtel), STC, Zain from the Middle East, and MTN and Millicom in Africa--have more than 300 million subscribers and have expanded across Africa and parts of Asia to sustain growth momentum.

The study also showed that Egypt's Orascom Telecom has become the eighth largest mobile network in the world by customer numbers, overtaking some of the well-established international operators. The research showed that fundamental change of operational models is central to sustained leadership and that significantly emerging markets have altered the telecommunications landscape.

"The past decade has been a highly successful one for the leading Middle Eastern and African operators. Supported by typically affluent and growing home markets and benign competition, both revenue growth and cash flow have been strong. And the leading operators have used this cash flow, supplemented by the ready availability of private capital, to build regional multinationals," said Anil Khurana, lead director of PRTM's Middle East Region and co-author of the report. Ameet Shah, head of PRTM's mobile services practice, served as lead author of the report.

Between 2003 and 2009, the leader board of the world's 30 largest mobile operators changed dramatically, according to this first-of-its kind report. The report identifies 19 new mobile leaders worldwide, measured either by number of subscribers or revenue. A common thread among these leaders is the continuous adaptation of their operating models to address new market conditions--crucial within a mobile industry where the game can change rapidly and where new players can quickly overtake yesterday's leaders.

"The rise of operators from emerging markets is testament to two factors: the rapid growth in their domestic markets, and their drive to play in multiple markets. But, as their existing markets start to mature, it is not yet clear that these companies will be able to revamp their operating models and sustain continued growth based on innovation, cost management, outsourcing, and the like," added Khurana, who calls these operators the "new multinationals."

The analysis reveals that the highest ranking mobile players over the past five years have modified their business models in ways that have led to profitable growth and support from shareholders, resulting in acquisitions and overseas expansion.

Telefónica and Telenor are prime examples of companies that have successfully ridden the boom of mobile usage in developing countries through strategic changes to their operating models.

This trend is evident in the emergence of large multinational operators from Russia, Africa, the Middle East and Latin America. It is also reflected through market consolidation within the US and through the growing importance of the leading Chinese and Indian operators. Those who have not adapted their operational models, including some major European operators, have experienced relative decline.

The report argues that operators that create the right operating models will increase performance and win investor backing in the international M&A game that is rationalizing many individual operators into global groups.

Consolidation during the next five years will mean an operator may need 300 million subscribers, or $50bn in revenue, to be among the global top 10 in 2014.

A deal with a French company will soon be concluded to supervise a project to build an underground railway in the capital Baghdad, the local mayor said.

“Companies from the United States, Russia, Germany, France and South Korea will be invited to submit their final bids for the project after a contract is signed with Systra”, Mayor Sabir al-Issawi told Aswat al-Iraq news agency.

France’s Systra, an international engineering and consulting group specializing in rail, will supervise the project.

(Aswat Al Iraq)

Russian "Gazprom" plans to issue $ 10 billion bonds 2010 to 2015. The organizer and the Under-guarantor of the bonds to be found by competitive tender.

It is expected to raise between $ 167 million and $ 334 million at a  nominal value of $ 33 .33 for a period  of between one and three years. The coupon period is 182 days.