Category: Oil News

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Masdar to Develop Solar Projects in Iraq

By John Lee.

Masdar, a subsidiary of the Abu Dhabi-based  Mubadala Investment Company, has signed a strategic agreement to develop 2,000 MW of solar photovoltaic (PV) projects in Iraq.

Heads of Agreement (HOA) were signed at a virtual ceremony by His Excellency Majid A. Hantosh, Minister of Electricity, the Republic of Iraq, Her Excellency Suha Al-Najar, President of the National Investment Commission (NIC) for the Republic of Iraq, and Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar.

The signing took place in the presence of His Excellency Ihsan Abdul Jabbar Ismail, Minister of Oil for the Republic of Iraq, His Excellency Suhail Al Mazroui, Minister of Energy for the UAE, and His Excellency Dr Thani Al Zeyoudi, the Minister of State for Foreign Trade for the UAE.

His Excellency Ihsan Abdul Jabbar Ismail, Minister of Oil for the Republic of Iraq, said:

“The Government intends to increase and enhance the national production of clean energy. Through this agreement with Masdar, we will generate 2 GW of solar power through projects in central and southern Iraq.

“Iraq is targeting 20 to 25 percent of energy coming from renewable sources, rather than fossil fuels, equivalent to 10 to 12 GW. This agreement with Masdar, a global leader in renewable energy, is an important step in the development of the clean energy investment sector and the exploitation of solar energy in Iraq.“

HE Suhail Al Mazroui, Minister of Energy for the UAE, said:

“We are grateful to the Government of Iraq for providing Masdar with the opportunity to contribute to the implementation of the Republic of Iraq’s renewable energy strategy. The UAE is committed to working with the Republic of Iraq to develop sustainable energy resources. This initiative also highlights the importance of public and private sector partnerships in finding affordable solutions.

“Masdar has been a pioneer in developing clean energy projects, and is now active in more than 30 countries around the world, with a total value of more than US$20 billion and a production capacity exceeding 11 gigawatts. Masdar will leverage the expertise it has built up through these projects to support the Republic of Iraq on its clean energy journey.“

HE Dr. Thani bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade, underlined the strong brotherly relations that unite the UAE and the Republic of Iraq, supported by many deep political, social and economic ties, and driven by the keenness of the leadership of the two brotherly countries to enhance prospects for cooperation in all fields, especially vital areas of common interest.

He pointed out that the cooperation between Masdar and the government of the Republic of Iraq will add significant value to the Emirati and Iraqi partnerships in addressing the challenges posed by climate change and keeping pace with the growing demand for energy. It will also contribute to supporting Iraqi efforts aimed at implementing quality projects to produce 10 gigawatts of solar energy by 2025.

HE Al Zeyoudi further affirmed the UAE’s keenness to facilitate channels of technology transfer, enrich knowledge and encourage the exchange of the best and most successful experiences to promote economic development in Iraq.

HE Suha Al-Najar, President of the National Investment Commission for the Republic of Iraq, said:

“The project is one of the largest renewable photovoltaic solar projects in the Middle East, and falls within the vision of Iraq’s sustainable transition plan 2021- 2030. The project delivers 2 GW of green energy for Iraq national network. It opens the way for cooperation and knowledge exchange between the two parties in the field of energy planning and sustainable transition. A steering committee of both parties is established for this goal. The business model is Independent Power Producer, and the investment will be according to law13-2006 of the National Investment Commission.

“The project ensures clean and sustainable energy production for different areas in Iraq, and displaces carbon dioxide emissions resulting from fossil fuel generation. The project will also provide new jobs in the energy sector, with the manpower for project construction and operation beyond 2,000.“

Mohamed Jameel Al Ramahi, CEO of Masdar, said:

“This agreement will define the path for the development of clean energy solutions that will drive growth in the Republic of Iraq and help the Government meet its climate goals. The UAE shares Iraq’s commitment to diversify away from a dependence on oil & gas, and to accelerate the transition to clean energy sources. We are proud to support the Government of Iraq on this vital stage in its clean energy journey and we will leverage our expertise to deliver a more sustainable future for the nation.”

(Sources: Masdar, Govt of Iraq)

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Iraq “Cancels” Oil Deal with China’s Zhenhua

By John Lee.

Iraq has reportedly cancelled its $2-billion pre-paid oil supply agreement with Zhenhua Oil Company.

Under a deal said to have been agreed in January, the state-owned Chinese company would pay Iraq in advance for a year’s supply of oil.

S&P Global Platts reported the following month that Iraq had “frozen” the deal, following an increase in oil prices.

The price of oil has continued to rise, with Iraq confirming an average price of $65.842 per barrel exported in May, considerably higher than the $53.294 per barrel it received in January.

More here.

(Source: S&P Global Platts)

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Iraq Oil Revenues almost $6bn in May

By John Lee.

Iraq’s Ministry of Oil has announced finalised oil exports for May of 89,881,268 barrels, giving an average for the month of 2.899 million barrels per day (bpd), slightly down from the 2.947 million bpd exported in April.

The exports from the oilfields in central and southern Iraq amounted to approximately 86,820,355 barrels, while exports from Kirkuk amounted to 3,060,913 barrels.

Revenues for the month were $5.918 billion at an average price of $65.842 per barrel.

April’s export figures can be found here.

(Source: Ministry of Oil)

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Lukoil paid over $60m to Iraqi Govt in 2020

By John Lee.

Russian oil company Lukoil has published details of its payments made during the financial year ended 31 December 2020 in favor of the government of Iraq:

  • The Dhi Qar Oil Company (DQOC) [Thiqar Oil Company] received 1,963 million Russian Rubles [$26.9 million] in respect of the Block 10 field;
  • The General Commission of Tax received 2,511 million Russian Rubles [$34.4 million] in respect of the West Qurna-2 field (pictured).

(Source: Lukoil)

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Increased Capacity at Dora Refinery

By John Lee.

Iraq’s Minister of Oil has opened two plants for improving gasoline and hydrogen production at the Al-Dora refinery in Baghdad.

The new gasoline line will increase capacity from 3 million liters per day to 4 million liters per day, and is part of a program to reduce fuel imports by 50 percent by the end of this year.

(Source: Ministry of Oil)

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GKP Shares Rise on Corporate Update

By John Lee.

Shares in Gulf Keystone Petroleum (GKP) ended the day up more than 6 percent on Friday, as the Kurdistan-focused oil producer gave an operational and corporate update:

Jon Harris (pictured), Gulf Keystone’s Chief Executive Officer, said:

“We continue to safely navigate a challenging operating environment due to COVID-19, with gross average year-to-date production of c.43,600 bopd, up almost 20% from 2020 annual average gross production. Today, we are pleased to announce that we have restarted work to complete SH-13, marking the resumption of drilling activities ahead of schedule.

“As a result, we now expect to increase gross production towards 55,000 bopd in Q4 2021 and to be at the upper end of 2021 guidance (40,000-44,000 bopd) as we continue to develop and realise the value of the Shaikan Field’s substantial reserves and resources for the benefit of all stakeholders.“

 55,000 bopd investment programme

  •  Successful restart of drilling activities, with commencement of SH-13 completion ahead of the previously announced schedule of Q3 2021.
  • After SH-13, SH-I will be drilled and electric submersible pumps will be installed in two existing wells.
  • Gross production is now expected to increase towards 55,000 bopd in Q4 2021, versus previous guidance of Q1 2022.

Operational

  • Continued strong safety performance, with no Lost Time Incident (“LTI”) recorded for over 530 days.
  • Continuing to effectively manage the impact of COVID-19 on production operations and the resumption of drilling activities despite continued challenges on the ground.  
  • Gross average production from the field in 2021 to date of c.43,600 bopd, in line with 2021 guidance.

Financial

  • $100.8 million ($78.9 million net to GKP) received from the Kurdistan Regional Government in 2021 to date for payments of crude oil sales and recovery of outstanding arrears. 
  • As previously announced, proposing a $25 million annual dividend and $25 million special dividend, both for approval at next week’s Annual General Meeting as we continue to balance investment in growth and returns to shareholders.
  • Retain a robust balance sheet, with a cash balance of $195 million as at 10 June 2021.

Outlook 

  • Expect 2021 average gross production guidance to be towards the upper end of the 40,000 to 44,000 bopd guidance range following early resumption of drilling activities.
  • 2021 guidance of $55-$65 million net capex and $2.5 to $2.9/bbl gross unit Opex remains unchanged.
  • Continuing to progress the preparation of the Field Development Plan, including the Gas Management Plan, through engagement with the Ministry of Natural Resources and other stakeholders; we will provide updates as this work progresses.

(Sources: GKP, Google)

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KRG to rely 100% on Natural Gas for Electricity

Ten electricity plants were provided with transformers at a ceremony attended by Deputy Prime Minister Qubad Talabani in Koya town on Thursday.

The Deputy Prime Minister commended the Koya transformer project and addressed developments in the electricity sector, including the Kurdistan Regional Government’s decision to go all in on natural gas.

“The power generation costs are still high,” said Deputy Prime Minister Talabani, “and to solve this, we are planning to increase the dependency on natural gas to 100 percent as a source of fossil fuel in power generation.”

Also in attendance at the Koya ceremony was Minister of Electricity Kamal Mohammed Salih, who provided more information on the 2.728 billion dinar (or roughly 1.8 million USD) transformer project.

Minister Salih hailed the cabinet’s achievements in power generation and distribution, and stated that more than 450 projects have been initiated with a total worth of 60 billion dinars.

KRG is planning to open three more power plants in the Kurdistan Region by the end of this year: a steam power plant in Khabat District, a gas power plant in the Garmian region, and a 37-megawatt plant in Deraluk.

The Deputy Prime Minister Qubad Talabani also talked about his latest visit to Baghdad with the KRG delegation to discuss the region’s share of the budget.

He noted that one of the topics of discussion was cooperative power generation between the federal and regional governments, a step that would drastically increase Iraq’s supply of electricity.

(Source: KRG)

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Iraqi Tankers Re-Registered in Umm Qasr

By John Lee.

Two oil tankers owned by the State Company for Maritime Transport (SCMT) have been transferred from Jordanian registration to registration in the Iraqi port of Basra, following the lifting of sanctions.

Iraqi Transport Minister, Captain Nasser Hussain Bandar Al-Shibli [Captain Nasser Hussein Bandar Al-Shibli], raised the Iraqi flags on the vessels, the Al-Asma’i and the Al-Qurna, at a ceremony at the port of Umm Qasr on Sunday.

(Source: SCMT)

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