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Reuters reports that OPEC has delayed a meeting of officials to help select its new secretary general, putting off delicate talks that could reignite rivalry for influence as Saudi Arabia, Iran and Iraq seek the top post.

A panel of officials was initially planned to convene at OPEC's Vienna headquarters during August, but the meeting is now more likely to take place in October.

Four of OPEC's 12 members have put forward potential successors to Abdullah al-Badri, a Libyan whose term finishes at the end of 2012.

Several delegates said the August talks were delayed because of difficulty in fixing the meeting around participants' schedules. But one said the group didn't want to deal with the delicate issue of succession at this time.

The four nominees are:

• Saudi Arabia's OPEC governor, Majid Al-Moneef;
• Thamir Ghadhban, energy adviser to Iraq's prime minister;
• Former Iranian oil minister, Gholam Hossein Nozari; and,
• a condidate from Ecuador.

(Source: Reuters)

To overcome Iraq’s current political crisis and prevent the breakdown of the entire post-2003 order, Prime Minister Maliki (pictured) and his opponents both will have to agree to painful compromises, according to this report from the International Crisis Group:

EXECUTIVE SUMMARY AND RECOMMENDATIONS

At first glance, the current Iraqi political crisis looks like just one more predictable bump in the long road from dictatorship to democracy. Every two years or so, the political class experiences a prolonged stalemate; just as regularly, it is overcome. So, one might think, it will be this time around.

But look closer and the picture changes. The tug of war over Prime Minister Nouri al-Maliki’s second term suggests something far worse: that a badly conceived, deeply flawed political process has turned into a chronic crisis that could bring down the existing political structure.

To avoid this outcome, both Maliki and his opponents need to make painful compromises: the prime minister should implement the power-sharing deal negotiated in 2010 and pledge to step down at the end of his term; in turn, his rivals should call off efforts to unseat him and instead use their parliamentary strength to build strong state institutions, such as an independent electoral commission, and ensure free and fair elections in two years’ time.

The present stalemate has its immediate roots in the Erbil accord between key political actors, which led to the second Maliki government. Key elements of the power-sharing agreement, which political leaders reached in a rush in November 2010 as impatience with the absence of a government grew, were never carried out.

By John Lee.

Iraq’s crude oil production overtook Iran’s last month for the first time since 1988, when the countries ended their eight-year war, reports Bloomberg.

Iraq pumped 2.984 million barrels a day in June, versus 2.963 million bpd for Iraq, OPEC said today in its Monthly Oil Market Report.

Production from Iran fell ahead of sanctions from the EU that started on 1st July 1, while Iraq is steadily increasing output.

OPEC’s 12 members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela.

(Source: Bloomberg)

By John Lee.

Several Saudi companies have expressed a desire to invest in the Kurdistan Region.

Assaf Ben Nasser, President of Administration & Human Resources of the Western Region and General manager of several factories in Saudi Arabia, and Abdulaziz Ben Othaymeen, a Saudi businessmen, told Puk Media that the commercial, industrial and investment markets are attractive to Saudi investors.

Ben Nasser said that the Saudi companies are ready to cooperate with Kurdish businessmen and factory owners in the field of investments, services, housing, training, import and export.

(Source: PUK Media)

Iraq's Deputy Prime Minister with responsibility for Energy, Hussain Al-Shahristani, talks to CNBC about the oil price, the risk of Iran shutting the Strait of Hormuz, and the possibility of rehabilitating the pipeline from Iraq through Saudi Arabia.

(Source: CNBC)

Iraq's State Company for Oil Projects (SCOP) will offer the construction of the Kirkuk oil refinery to international companies on a build, operate and own (BOO) basis in December 2012, according to a report from Steel Guru.

The report quotes Mr Salar Ameen, deputy chairman of the National Investment Commission (NIC) as saying that "feasibility studies are ongoing with two Italian and American advisers. The Iraqi oil ministry will make public the specifications before the end of the year. The refinery will cost approximately of USD 6 billion with a capacity of more than 150,000 barrels per day of oil".

Mr Ameen said that companies from the US, China, Korea, Saudi Arabia and the UAE have expressed interest in bidding for the project. Construction is expected to be completed by the end of 2016.

The Kirkuk refinery project is part of the oil ministry's plan to build several refineries across the country to meet increasing domestic demand. These refineries will have a total capacity of 740,000 barrels per day at an estimated cost, according to the report, of $20 billion.

(Source: Steel Guru)

(Photo: Najaf Refinery)

In May, Turkey and Iraqi Kurdistan announced they would build pipelines taking oil and gas from Iraq into Turkey, then possibly Europe. But according to this article from NIQASH behind the energy dream, lurks a nightmare of militant Kurdish independence fighters and the spectres of energy giants, Iran and Russia.

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

To some it is a dream come true, others think it’s a nightmare that will never see the light of day. The May 2012 announcement by Ashti Hawrami, the Minister of Natural Resources in the semi-autonomous state of Iraqi Kurdistan that they would build new oil and gas pipelines to Turkey shook the Iraqi government in Baghdad.

The first phase of pipeline construction is supposed to be completed by October this year and the second phase is due to be finished by August 2013. Another pipeline is to be built by 2014.

Baghdad reacted unhappily to this announcement, saying – as they had done with other oil deals – that the Kurds were working outside of the national remit. National Deputy Prime Minister for Energy, Hussein al-Shahristani, was dismissive of the pipelines and local media were also rather negative about it.

Yet it appears that Baghdad feels that that the northern state of Iraqi Kurdistan is slipping out of its control. For the last five years Baghdad has been trying to reign in the Kurdish government, especially when it comes to oil and gas.

Shahristani has blacklisted oil companies operating in Iraqi Kurdistan and even ensured that, during the recent lacklustre fourth round of bidding to do oil work in Iraq, there was a new clause preventing any oil companies from going into Iraqi Kurdistan without Baghdad’s permission, as oil major Exxon Mobil did in November 2011.

Iraq has named Thamer Ghadhban as its candidate for the position of head of OPEC, and some analysts believe he could be an acceptable compromise candidate.

Based on current differences, "I don’t believe it can be an Iranian or a Saudi," said Neil Atkinson, an energy analysis director at UK research firm Datamonitor, who notes that the decision must be unanimous.

He added, "the Iraqi could be an acceptable candidate. OPEC has come up with a compromise candidate before."

The fact that the Iranians and Saudis are both vying for the job "could create frictions," said an OPEC delegate from an African country. For that reason, the delegate said it was likely the group would pick either the Iraqi or the Ecuadorian. “We will choose a neutral candidate,” he said.

Iraq is gradually shifting towards a more high-profile role within the group. The country is currently still exempt from the OPEC quota system, although Iraq’s reinstatement is seen as more imminent than it was previously.

Iraq’s approach is two-pronged. It wants an Iraqi official installed in high office in the group, and has suggested that it will be willing to submit to output-restraint disciplines.

(Source: Gulf Times)

The chief executive of the Iraq Stock Exchange (ISX), Taha Abdulsalam, believes secondary listings for local companies on bourses in London and New York would eventually attract extra liquidity and boost trade.

"That is the long-term strategy. It's not going to happen overnight, but the plan is to aim to develop the same standard of bourses and companies outside."

Although companies have already adopted International Financial Reporting Standards (IFRS), he said Iraqi companies need to improve their disclosures, including timing, and their level of corporate governance, especially with regard to insiders.

Mr Abdulsalam said the market had the potential to grow once Iraq eased its reliance on the oil sector for growth.

"Iraq's stock market has the potential to grow to the size of Saudi Arabia, it has the oil, a huge population and very diversified sectors," said Anastasios Dalgiannakis, the head of institutional trading at Mubasher Financial Services in Dubai, which last year signed an agreement to offer live prices for the exchange.

"But many investors are waiting for a foreign custodian to operate in Iraq," Mr Dalgiannakis said. "Investors are willing to take the risk and invest in Iraq, but not to take additional counter-party risk."

In March, the ISX mandated that any bank, foreign or local, could apply to a custodian of investor assets. The exchange is in talks with two international investment banks, and expects a resolution in the next four months, Mr Abdulsalam said. He declined to name the banks.

Mobile operators in Iraq have been under pressure from the government to list their shares under the terms of the licence bought in 2007. If the main telecommunications companies listed on the exchange, Abdulsalam said, the market's capitalisation would double overnight from its current level of $4 billion.

"Until now, they have not given any request to list on the stock exchange," he said.

(Source: The National)

Preparations are being made for a fourth auction of oil and natural gas exploration zones. This will be in line with the country's aim to rival Saudi Arabia as one of the world’s leading oil producers.

Iraq’s official statistics reveal that oil reserves are pegged at 143.1 billion barrels, the fourth largest in the world.  However the former oil minister who is now deputy prime minister Hussain al-Shahristani says the country has potential reserves of over 214 billion barrels.

Iraq’s Oil Ministry revealed that 12 new exploration zones will be auctioned off on Wednesday May 30^{th –} Thursday 31^st May 2012. All of the exploration zones are in remote areas which in turn makes them vulnerable to insurgent attacks.

The zones are mainly situated in Western and Central Iraq and companies who win the licenses will have to be able to commit to spending $90 million – 200 million.

Analysts state that Shahristani (Pictured) initially aimed to boost production to 10 million – 12 million bpd by 2017, this will not occur due to the underdeveloped infrastructure, the boost in production has been pushed back to 2020. “While the government’s most ambitious targets suggest 12 million – 13 million bpd by 2020 is theoretically possible, an output plateau of around 6 million – 7 million appears more likely” according to Oxford Analytica. Even this would earn the Iraqi Government $1 billion per day to fund on-going national reconstruction.

(Source: UPI)