Custom Search

Kentz has announced the award of three individual, reimbursable, service contracts in Iraq with a total value to the company of circa US$55 million, through its Technical Support Services business unit.

Across the three projects, Kentz will provide services over the next three to four years that will oversee the development of in-plant process facilities and infrastructure to deliver a combined increase in production capacity of approximately 250,000 bpd of oil and 300 million standard cubic feet of gas. Kentz will be working on both new and existing upstream facilities, based in the Basra and Baghdad areas.

The scope of services to be provided include project management, front end engineering, procurement and installation supervision support for three oil and gas facilities. Kentz will draw resources from offices in Basra, alongside Abu Dhabi, Dubai, and Saudi Arabia.

Kentz first commenced operations in Iraq in 1981 and in August 2010 announced that it had reached agreement to acquire an interest in Dome General Contracting Company Ltd. (Iraq); a leading supplier of services to Iraq's energy sector. The awards announced today are in-line with Kentz's stated strategy to grow its presence in the Iraqi hydrocarbons market.

Mike Murphy (pictured), Chief Operating Officer, Technical Support Services for Kentz, commented:

"We are delighted to have been awarded a succession of new contracts in Iraq, which underpin our continued focus on the Middle East region and the opportunity that we highlighted to the market.

"Iraq has the third largest proven oil reserves in the world and Kentz is well positioned to support key clients through in-country resources and a proven track-record of delivery, backed up by a global supply network of engineering and procurement resources."

(Source: Kentz)

By John Lee.

OPEC ministers have failed to agree on a new secretary general and have asked Abdalla el-Badri to stay in the post for another year.

Four countries had been competing for the job -- Saudi Arabia, Iran, Iraq and Ecuador -- but Ecuador’s candidate, oil minister Wilson Pastor-Morris, announced last week that he had withdrawn his candidacy.

This left former Iranian oil minister Gholamhossein Nozari, former Iraqi oil minister Thamer Ghadhban [Ghadban] (pictured) and former Saudi Arabian OPEC governor Majid Moneef in the running.

A report from Platts questions if the job be opened up again to allow new applications, and wonders if a "white knight" might emerge who would be acceptable to all countries.

(Source: Platts)

By Mark DeWeaver.

Another roller coaster year for the ISX is drawing to a close. By the middle of May, the Rabee Securities RSISX index had fallen 24% from its early October 2011 peak. Since then, the market has staged a dramatic rebound. As of December 8, the index was down just 3% from the October high and up 8% for the year.

This rebound is all the more remarkable because it has occurred in the absence of any pick up in foreign participation. In 2011 foreigners were net buyers in 97% of the trading weeks with a share of monthly volume that exceeded 10% in all but three months. This year, foreign net buying has fallen sharply. (See chart.) Foreigners have been net sellers in about 40% of the trading weeks so far. Their monthly-volume share has exceeded 6% in only two months. (See the latest Rabee Securities Weekly for a nice chart of the foreign share of monthly volume.)

There is also no obvious catalyst for fresh inflows of foreign money at this point. While the regulators have finally decided to offer custodian bank licenses, HSBC has apparently lost interest in providing share custody in Iraq and no one else has stepped up to take its place. (See this post for more on the custody issue.) EFG-Hermes also seems to have suspended its swaps program, shutting down another potential channel through which institutional investors might have accessed the market. (There’s more on the EFG swaps here.) Even the much-vaunted Asiacell IPO, which I once thought might at last put the ISX on foreign fund managers’ radars, now appears to be targeted mainly at local individuals.

This failure to attract outside money is not the end of the world, however. When the right economic fundamentals are in place, emerging markets can easily go up without foreigner investors. Think of the largely closed Chinese and Saudi markets for example. Or Kuwait’s infamous Souk al Manakh, which rose to such dizzy heights in 1982 that it was briefly the third largest market in the world after the US and Japan.

For the ISX to keep going up, problems like share custody don’t really need to be solved. The important thing is for the Iraqi economy to stay on its current high-growth trajectory. As long as the listed companies' earnings are growing at double digit rates and local investors are flush with cash there’s really no reason why this year’s home-grown rally shouldn't continue into 2013.

UAE Law Firm Bin Shabib & Associates LLP has strengthened its presence in the MENA region by launching a new office in Erbil, Iraq. The launch marks BSA's second foray into the MENA market in as many months, having already expanded into Muscat, Oman, this year.

After more than a decade in the UAE, the launch is in line with plans for growth, in recognition of the increase in demand from its clients and the continued activity in the Iraqi market. This expansion will allow BSA to strategically position itself as one of the market leaders in legal service providers in the MENA region and enable it to service the needs of its clients in Iraq.

Jimmy Haoula (pictured), Managing Partner of BSA commented:

"These are exciting times for the firm as we embark upon this new venture. Erbil is a gateway to Iraq due to its stability and proximity and enables BSA to leverage upon and build a secure platform for the future opening of our Baghdad office next year. Given that UAE-Iraq trade has expanded by 60% last year, the opening of our Erbil office will allow us to be part of the successful development and advancement of a world class city in years to come.

"As with all our expansions in the region, we have invested heavily in local lawyers who know the market and have rights of audience in their respective local jurisdictions. This will give our clients peace of mind and provides us with the 'cutting-edge' amongst our competitors."

BSA's recent launch coincides with the announcement from the Dubai Chamber of Commerce and Industry of their new strategy to set up a representative office in Iraqi Kurdistan next year, with a view to bolster the strategic alliance between Iraq and the UAE. This further enunciates the long term views of the Chamber in depicting Iraq as a key jurisdiction for cross-border trade.

H.E. Abdul Rahman Saif Al Ghurair, Chairman of the Dubai Chamber of Commerce and Industry commented:

"The new office will help boost the presence of Dubai businesses in the northern region of Iraq as the country was the second largest destination for Dubai Chamber members' exports and re-exports accounting for 14 per cent of total goods traded with regional partners during the first half of this year.

"The rising profile of Kurdistan's investment potential can be gauged from the fact that Iraq which ranked 14th on the list of Dubai's top trading partners in 2008 jumped to 7th position in 2011."

The new venture gives BSA a network of 7 offices in 4 different countries, namely the UAE, Oman, Iraq and Lebanon, with another office scheduled to open in December of 2012 in Riyadh, Saudi Arabia. BSA is a full service law firm offering corporate, commercial and litigation services to international and regional companies from all industry sectors through dedicated practice departments, which are headed by highly experienced legal experts.

Since its establishment in the UAE in 2001, BSA has grown to become one of the leading and most innovative local law firms in the UAE with continued expansion in the MENA region and was the first of the local law firms to set-up an office in the Dubai International Financial Centre ('DIFC').

By John Lee.

Majid Jafar (pictured), the chief executive of UAE-based Crescent Petroleum, has said the company is gearing up for expansion in the Iraqi oil and gas sector.

Speaking to Reuters on the sidelines of the World Economic Forum (WEF) in Dubai, he said:

"We are looking at entering Libya with the right opportunity. Other countries like Lebanon, despite plans being delayed, have been setting up regulations bodies in preparation. It’s an area of potential interest."

Crescent Petroleum, which is based in Sharjah, plans to expand investment and production in Kurdistan and into other areas in Iraq given the country’s under-explored state.

“There are only 2,000-3,000 wells drilled in the whole of Iraq so far compared to 10 times as many in Saudi and 1 million wells in Texas alone,” Jafar added.

The Iraqis are only beginning to develop the sector, he said, adding that there has not been a consensus on policy and there is still a mindset that the state needs to manage the sector.

(Source: Reuters)

By Thomas W Donovan, attorney at the Iraq Law Alliance.

Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Foreign "experts" like to depict Iraq's oil industry as a cesspit of corruption, turmoil and factional politics. In fact, however, Iraq has made real progress, and is aiming for more. But it is true that serious legal, political and technical challenges must be met if the sector's ambitious plans are to become reality.

Remember that the events of the last decade, beginning with the US-UK invasion of March 2003, have presented Iraq with far more social, economic, military, legal, political and infrastructure challenges than any of its Opec neighbours have faced.

Getting oil production up to the current level of about 3 million barrels per day (bpd) is an accomplishment in itself. Baghdad says production is at a 20-year high; the US says Iraq has now surpassed Iran in daily production.

The Iraqi government plans to keep pumping, and is bringing in major international oil companies. The government has now held four petroleum licensing rounds: in the first three, private companies bid to take over certain producing oil and gasfields from the old state monopoly company; the fourth was for exploration rights in promising areas not yet producing.

Dubai's DAMAC Properties has signed a memorandum of understanding with the Iraqi Minister for Construction and Housing on the final day of Cityscape Global 2012.

The region’s largest private luxury developer already has two plots of land in Baghdad that was previously bought from the private sector and is currently developing designs with the projects to be announced shortly.

The agreement will see DAMAC Properties provide expertise and insight for a number of residential and commercial projects in Baghdad and the surrounding region. The MoU is the result of many months of negotiations, culminating in high-level talks, which were concluded during the exhibition.

DAMAC Properties has also opened a branch office in Baghdad, further enforcing its commitment to developing in the country.

Mohammad Al Darraji, Iraqi Minister of Construction and Housing, met with DAMAC Properties Chairman Hussain Sajwani at the DAMAC Properties stand at Cityscape Global and signed an agreement which will allow DAMAC Properties to further expand its operations in Iraq.

Speaking earlier to delegates at the Cityscape conference, Mr. Al Darraji said:

“Iraq has seen significant changes to regulations and the governing of economic activities. The new laws promote fresh investment and this transition will promote the rapid restructuring of our economy.”

Mr. Sajwani added:

“DAMAC Properties is delighted to be invited to work with the Iraqi government on these forthcoming projects. This is a significant agreement which will allow us to take the DAMAC Properties commitment of luxury and quality to a new territory.”

DAMAC Properties currently has 65 buildings currently at various stages of construction in Dubai, Abu Dhabi, Qatar, Egypt, Lebanon, the Kingdom of Saudi Arabia and Jordan. The company has already completed 37 buildings throughout the Middle East and North Africa, with the latest project, Marina Bay in Abu Dhabi receiving its handover certificate only last month.

“DAMAC Properties is continually looking for the right opportunities to bring the luxury living brand to other parts of the world,” said Mr. Sajwani. “We are doing due diligence on a number of projects in different countries and if we believe the circumstances are right and our brand can add value to a particular country, we will seriously consider it, as we aim to become one of the leading luxury developers not just in the Middle East but the world.”

The Iraqi government has been showcasing various projects during Cityscape Global 2012 and discussing a number of private-public partnerships with potential investors. During a speech to the conference Al Darraji said that US$ 10.4 billion worth of construction and infrastructure projects are expected to be approved next year and that the ministry has 65 projects worth US$ 3 billion with 60,000 units already under construction.

(Source: DAMAC)

By Shwan Zulal.

This article was originally published by Niqash. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

How will I support myself in my old age? People ask this question all around the world. One Kurdish writer argues that a universal pension scheme could be a catalyst for a more dynamic private sector and economic growth in Iraq.

No matter where they live, one of the questions in the back of many people's minds is: how will I support myself and my family when I am no longer able to work? Whether that is because of old age or illness, it’s a common concern.

In Iraq and in the semi-autonomous region of Iraqi Kurdistan, people ask the same question. And given the recent unstable history of the country, people are understandably anxious about the future.

Most Iraqi businesses in the private sector do not have any kind of pension scheme. And while there are various benefit programmes, these tend to be vague and certainly don’t instil any sense of security. Which is why this fear has driven many people to do whatever it takes to become eligible for the generous government pension schemes for state employees.

On average, working in the private sector will see employees paid higher salaries but often there are more demands are made on staff members in this sphere, where productivity is measured more closely. But a government employee who retires after an average of 20 years in a state job may get paid more in the long run.

Additionally every year, scores of graduates enter the Iraqi job market and they most often expect to be employed by the government. The system dates back to Iraq under Saddam Hussein when there were few other employers than the government. Speak to any young person in Iraq and you’ll hear the same message: why should I do a hard day’s work when I can get a low level, public sector job and do as little as possible for a guaranteed salary and a pension? Public servants also get other perks – they may qualify for housing grants and interest free loans from the government, including loans that allow them to get married.

Baghdad will host Iraq's most anticipated energy event thus far on the 12/12/2012. Founded and hosted by Iraq Energy Institute (IEI), the Iraq Energy Forum (IEF) represents a unique gathering, distinguished by its exclusive line-up of senior Iraqi government officials and decisions makers, ambassadors, IOCs, industry leaders and cross-sector world renowned industry experts.

The event will be more than a conference and a networking opportunity, it will be a medium to influence and shape the Iraqi energy industry in the next phase of its evolution, as stakeholders will have the opportunity to directly engage with regulators, policy and decision makers, exchange views, as well as first hand and early insight into the investment and development plans and project announcements.

The Forum will duly commence on the 12th of December, with day one focusing on upstream-downstream challenges and opportunities, in addition to capacity building within Iraq. Day two of the event will focus power generation needs and projects, infrastructure challenges and investments opportunities, in addition to sustainability and resource-diversification.

Day one of the Iraq Energy Forum will be preceded by three simultaneous full day master-classes on the 11th of December. The master-classes will follow the theme of the Forum, with Master-Class 1 on Petroleum Development Policies & Field Operations which will cover all aspects of upstream sector in Iraq. Master-Class 2 on IPP & EPC Contracts will address IPP programmes, and tendering & contracting processes, conducive to preparing successful bids. Master-Class 3 will revolve around capacity building and improved on-going training and development.

The Master-Classes will provide participants with unparalleled insight into technical and procedural aspects of the industry in Iraq that would facilitate commercial success in a growing and evolving energy sector, that holding generous untapped potential. Mr Luay al-Khatteeb, Founder & CEO of Iraq Energy Institute has said this year on Bloomberg: “projected global demand will need two more of Saudi Arabia by 2035, and the only candidate right now that we can think of to fill the gap, and boost security of energy supply prospects is Iraq”.

Iraq's oil production reached a record high of over 3 mbpd in 2012 and the government is committed to ambitious plans of at least tripling production before the decade's end. Further, vast amount of gas reserves in Iraq remain underutilise, and Iraq's urgent power needs are well publicised.

Infrastructure de-bottlenecking, development and rehabilitation projects are paramount in dealing with the challenges ahead, therefore ample opportunities to capitalise and get involved in the next wave of investments will be on offer and should not to be missed. According to Prof. Ali Al Sayigh, Director General of the World Renewable Energy Congress and Chairman of the Board of Iraq Energy Institute: “ the energy industry in Iraq has made great strides so far, but it is time to introduce sustainability as building block for future developments and plans, since the Iraqi energy sector is not only vital to the Iraqi economy, but global energy markets at large”.

The Iraq Energy Forum has strong state support, with several confirmed ministers and heads of the decisions making committees in Iraq, which will provide further insight into government policies and directions, helping investors plan their strategies and investments for Iraq with optimal efficiency. The Forum benefits from enviable Ambassadorial participation, and the event will also close with an Ambassadorial Reception, which provides further networking opportunities.

“Project Iraq 2012” expected to lay solid foundations for the region’s bustling construction sector

For the fifth consecutive year, “Project Iraq” – the International Exhibition for Construction and Environmental Technology, Materials and Equipment – will be held at Erbil International Fair Ground (EIF), bringing together local, regional and international companies and decision-makers in the construction sector.

Organized by IFP Iraq – member of International Fairs & Promotions (IFP) Group, Project Iraq is the largest specialized exhibition in Iraq and one of the fastest growing shows in the entire Middle East. In last year’s edition, the show brought together 393 local, regional and international companies from 20 countries, scoring a 30% growth in the number of participants.

Project Iraq’s ongoing success is widely influenced by the country’s dynamic construction market which is fueled by reconstruction and development projects across all economic sectors, including infrastructure, housing, hospitality, education and others. In 2010, Iraq’s construction industry was valued at US$ 5.6 billion with an annual growth forecast of 6.18% until 2014. Today, the busy pipeline of current and underway projects is triggering a massive demand in terms of building material, technology, and qualified human resources.

Consequently, “Project Iraq 2012” is the ideal platform for engineers, energy experts, field specialists, investors and entrepreneurs, buyers, and distributors to gather, share innovations and seize valuable business opportunities. Expanding over 11,000 sqm, the show is expected to draw a professional crowd of more than 23,000 visitors, giving them the exclusive opportunity to learn more about the latest industry trends from more than 400 international exhibitors; to network with key decision-makers and other professional trade visitors from both the public and private sectors; explore new business opportunities, joint ventures, and much more.

Supported by a wide pool of international official bodies from Belgium, China, Egypt, Germany, Greece, Iran, Italy, Syria and Turkey, and local governmental bodies including the Ministries of Consternation & Housing and the Ministries of Electricity, “Project Iraq 2012”has attracted international participants from the four corners of the world namely from Belgium, China, Egypt, Finland, France, Germany, Greece, India, Iraq, Iran, Italy, Jordan, the Kingdom of Saudi Arabia, Kuwait, Lebanon, Spain, Syria, Thailand, Turkey, the United Arab Emirates and the United Kingdom.

Exhibits at the show will include the latest innovations covering all construction aspects such as building material, stones and stone products, heating, ventilation and air conditioning (HVAC) systems, machinery and vehicles, sanitary products, wood products, metal products amongst other; and aimed at helping visitors improve their company productivity, upgrade their projects’ quality, grow their business and deliver faster.

Adding value and depth to every visitor’s experience, Project Iraq is held concurrently with “Energy Iraq 2012” -the 2^nd International Exhibition for Electricity, Alternative Energy, Lighting and HVAC - the only international exhibition in Iraq and the neighboring countries exclusively dedicated to electricity, alternative energy, lighting and HVAC.

Don’t miss Project Iraq 2012 from 17 to 20 September 2012, atErbil International Fair Ground (EIF) from 14:00 till 20:00 daily. To pre-register your visit, log on to www.project-iraq.com.