Latest news with #MohammedAl-Sudani
Yahoo
2 days ago
- Business
- Yahoo
Superpower Struggle Puts Iraqi Kurdistan's Oil Autonomy at Risk
It has been over two years since the Baghdad-based Federal Government of Iraq (FGI) placed an embargo on independent oil exports from the Erbil-based Kurdistan Region of Iraq (KRI). The legal basis for the halting of these essential flows to the finances of the semi-autonomous region of Kurdistan was the International Chamber of Commerce's (ICC) order that they would not be resumed until Turkey paid the FGI the US$1.5 billion in damages for these allegedly unauthorised oil exports over many previous years. That said, the real reason why the FGI moved to stop the KRI's independent oil sales is simply that it wants to remove any independent status from the region and roll it into the rest of Iraq as just another province like any other. Baghdad has correctly identified the best way of doing this as cutting off the KRI's key source of revenue through which it finances its semi-autonomous status – revenues from independent oil sales. Early in his new office, Iraq's Prime Minister Mohammed Al-Sudani carefully laid out this as being Baghdad's plan when he introduced the new Unified Oil Law being drafted at the time. He said that it would be run in every respect out of Baghdad, that it will govern all oil and gas production and investments in both Iraq and its semi-autonomous Kurdistan region, and that it will constitute 'a strong factor for Iraq's unity'.Unsurprisingly, the great global powers have their own views on whether the KRI should lose its semi-independent status and be subsumed into a greater Iraq. To begin with, both the U.S. and its allies, and China and its allies, know that Iraq as a whole is full of oil (and associated gas). The FGI side officially holds a very conservatively-estimated 145 billion barrels of proved crude oil reserves (nearly 18% of the Middle East's total, and the fifth biggest on the planet), according to the Energy Information Administration. Unofficially, it is extremely likely that it holds much more oil than this. In October 2010, Iraq's Oil Ministry increased its own official figure for the country's proven reserves but at the same time stated that Iraq's undiscovered resources amounted to around 215 billion barrels, as analysed in full in my latest book on the new global oil market order. This was also a figure that had been arrived at in a 1997 detailed study by the respected independent oil and gas firm Petrolog. However, even this did not include the KRI's actual and potential oil reserves. As the International Energy Agency highlighted at the time, before the relatively recent rise of exploration activity in the semi-autonomous region, more than half of the exploratory wells had been drilled prior to 1962 -- a time when technical limits and a low oil price gave a much tighter definition of a commercially successful well than would be the case today. Based on the previous limited exploration and development of oil fields in the KRI area, the proven oil reserves figure was first put at around 4 billion barrels. This was subsequently upgraded by the KRG to around 45 billion barrels but, again, this may well be a very conservative estimate of the oil resources there. Additionally important to both sets of superpowers is Iraq's geographical and geopolitical importance, located as it is in the heart of the world's greatest hydrocarbons region. In the former's case it is a key link in the land bridge from the Asia-Pacific region into Europe and in the case of the latter it is a core part of the Shia Crescent of Power dominated by Iran as a counterpoint to the Sunni style of Islam championed by Saudi Arabia. Given these factors, the stakes for both the West and the East in winning the most influence in the country – north, south or combined – are exceptionally high. To put it plainly: the U.S. and its key allies want the KRI to terminate all links with Chinese, Russian and Iranian companies connected to the Islamic Revolutionary Guards Corps over the long term, a senior source who works closely with the European Union's (E.U.) energy security complex exclusively told recently. 'This could then be used as a bridgehead to reassert the West's influence in the rest of Iraq through big investment deals firstly, and then related infrastructure developments,' he added. The most notable such deal in the south of Iraq so far is TotalEnergies' US$27 billion four-pronged deal, including the cornerstone Common Seawater Supply Project, analysed fully in my latest book. In the north, BP's US$25 billion deal across five major oil fields is similarly strategically vital for the West's future plans. The U.S. and Israel also have a further strategic interest in utilising the Kurdistan Region as a base for ongoing monitoring operations against Iran, according to the E.U. source. On the other side of the equation, China and Russia have long been behind the idea of subsuming the KRI into the wider Iraq. As a senior political source in Moscow exclusively told many months ago: 'Iraq will be one unified country and by keeping the West out of energy deals there, the end of Western hegemony in the Middle East will become the decisive chapter in the West's final demise.' Legally speaking, Iraq's 2005 Constitution cannot settle the matter of whether the KRI or FGI has the predominant rights over revenues from oil drilled in the KRI's area. According to the KRG, it has authority under Articles 112 and 115 to manage oil and gas in the Kurdistan Region extracted from fields that were not in production in 2005 -- the year that the Constitution was adopted by referendum. In addition, the KRG maintains that Article 115 states: 'All powers not stipulated in the exclusive powers of the federal government belong to the authorities of the regions and governorates that are not organised in a region.' As such, the KRG maintains that, as relevant powers are not otherwise stipulated in the Constitution, it has the authority to sell and receive revenue from its oil and gas exports. Additionally, it argues the Constitution provides that, should a dispute arise, priority shall be given to the law of the regions and governorates. However, the FGI maintains that under Article 111, oil and gas are under the ownership of all the people of Iraq in all the regions and governorates, which means they should be controlled by the FGI via the State Organization for Marketing of Oil. Consequently, given the lack of legal clarity on the issue, the KRI's future looks set to be determined by a straight superpower brawl. China would seem currently to have the advantage in terms of land and resources held. More than a third of all Iraq's proven oil and gas reserves and over two-thirds of its current production are managed by Chinese companies, according to industry figures. In hard numbers, Chinese companies combined have direct shares in around 24 billion barrels of reserves and are responsible for production of around 3.0 million barrels per day (bpd). Additionally, it has developed a spider's web of influence through multiple infrastructure projects that run adjunct to its oil and gas developments, as also detailed fully in my latest book. That said, the U.S. and its allies appear to be picking up the pace on building out their presence across Iraq, too, in line with the aforementioned plan to do so. In addition to the potentially game-changing projects of TotalEnergies and BP, May 19 saw two deals signed by U.S. firms HKN Energy, and WesternZagros, to develop two fields – the Miran gas field and the Topkhana oil and gas field -- in the KRI area. U.S. Energy Secretary Chris Wright was also very clear about the deeper intention behind these deals, saying that they align with the administration's broader strategy of striking commercial deals with allies to counter Iran's influence. By extension, given the extremely strong links between Tehran and Beijing and Moscow, this also means countering China's and Russia's influence across Iraq as well. By Simon Watkins for More Top Reads From this article on
Zawya
05-05-2025
- Business
- Zawya
Iraq asks Chinese firm to start Al-Sadr city project
Iraq has asked the Chinese Shandong Construction company to start a project to build the new Al-Sadr City near the capital Baghdad. Prime Minister Mohammed Al-Sudani, who headed a meeting of the project's committee on Sunday, directed members to contact the Company to launch the project. 'Sudani gave instructions for the Chinese contractor to embark on the project after it completed its design,' the official Iraqi news agency said. In early 2025, Iraqi officials said Shandong has been awarded Al-Sadr project, which includes the construction of nearly 11,000 houses. Nearly 49,000 more houses are planned in Phase 2 of the project, one of several residential schemes planned by Iraq to tackle a persistent housing supply crisis. (Writing by Nadim Kawach; Editing by Anoop Menon) ( Subscribe to our Projects' PULSE newsletter that brings you trustworthy news, updates and insights on project activities, developments, and partnerships across sectors in the Middle East and Africa.
Zawya
22-04-2025
- Health
- Zawya
Iraq launches medical city project
Iraq broke ground on Monday for its largest medical city that comprises seven hospitals with a total 700 beds, the official Iraqi News Agency reported. Prime Minister Mohammed Al-Sudani laid the ground stone for the project in the Southern Nasiriyah city at a cost of around 490 billion Iraqi dinars ($377 million) it said. The facility comprises 13 different medical specialisations including heart, cancer, pediatrics, and other sections besides outpatient clinics, recuperation centres, studies sections, green parks, roads and power facilities. 'This is Iraq's first integrated medical city which will provide all types of treatment to citizens and save them from travelling abroad for treatment,' Sudani said. (Writing by Nadium Kawach; Editing by Anoop Menon) (
Zawya
10-04-2025
- Business
- Zawya
Schlumberger awarded Iraq's Akkas gas field development
OPEC member Iraq has awarded Phase 1 of the development of Akkas gas field to the US-based Schlumberger Company, media reports said on Thursday. The cabinet agreed on an 'urgent' investment plan to develop the country's largest gas field at a meeting headed by Prime Minister Mohammed Al-Sudani on Wednesday. 'The cabinet agreed on an urgent investment plan for Akkas… phase 1 will be executed by Schlumberger and the rest by the Midland Oil Company,' Aliqtisad News said. Iraq's Oil Ministry announced in 2024 it has awarded the Akkas project to Ukraine's Ukrzemresurs Company but it was not clear if the contract has been terminated. Iraqi parliament's oil and gas committee had criticised the Ministry for awarding the deal to that company on the grounds it is little known and does not have the technology to develop such an immense field. Akkas field in the Western Al-Anbar governorate was abandoned by South Korea's state-owned Korea Gas Corporation (Kogas) after it was captured by ISIS militants nearly a decade ago. Discovered in 1992, it contains around 5.6 trillion cubic feet of natural gas deposits, according to the Ministry. (Writing by Nadim Kawach; Editing by Anoop Menon) (
Zawya
09-04-2025
- Business
- Zawya
JP Morgan, Iraq discuss funding for projects
The US-based financial services firm JP Morgan offered to fund projects in Iraq during talks with its Prime Minister Mohammed Al-Sudani in Baghdad on Tuesday. Sudani met a delegation headed by the JP Morgan Vice Chairman Daniel Zelikow at a Conference on Reforming the Iraqi Banking Sector. A statement by Sudani's office said the meeting explored opportunities to deepen cooperation in banking and financial services, including JP Morgan's potential role in funding investment projects in Iraq. The two sides discussed 'mechanisms for securing financial credits and transfers to ensure they reach their recipients in Europe and the United States, it said. 'Al-Sudani stressed the importance of expanding partnerships between Iraqi banks and JP Morgan…he also emphasised the government's full readiness to provide all forms of support to strengthen this relationship,' the statement said. 'JP Morgan's delegation, in turn, expressed interest in expanding its footprint in Iraq's financial system, confirming plans to increase correspondent accounts for local banks and expressing willingness to finance projects directly or through financial partners.' (Writing by Nadim Kawach; Editing by Anoop Menon)
