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Deloitte Report on Oil and Gas in Kurdistan

Pursuant to the Kurdistan Regional Government Council of Ministers resolution No.73 (3 February 2016) establishing an independent review of the oil and gas industry, today new verified data on oil exports, consumption and revenues have been published covering the period from 1 July 2017 to 31 December 2017. This is a continuation from the first public report of the first half of 2017 published in January 2018.

The new, verified data and information pertaining to the Kurdistan region’s oil exports, consumption, and financial flows of the last six months of 2017 have been independently reviewed by the international “Big 4” audit and consulting firm, Deloitte.

The Regional Council for Oil and Gas Affairs underscores its commitment to transparency in the sector, as it firmly believes it is the right of the people of Kurdistan to be informed of accurate and independently verified production and revenue information. This independent review is only one part of the government’s transparency program.

The report similarly demonstrates the Kurdistan Regional Government’s commitment to its stakeholders in the oil and gas industry. In response to feedback received from stakeholders on Deloitte’s first review, the new report presents additional disclosures. This includes a breakdown of third-party payments; disaggregate monthly price realised during the period; and the recent arbitration settlement.

The Regional Council for Oil and Gas Affairs reiterates its commitment to the people of Kurdistan and stakeholders in the sector that the two international audit firms, Deloitte and Ernst & Young, will continue to independently review the oil and gas sector, inclusive of all the streams. To that end, we are anticipating the data for 1 January 2018 to 31 March 2018 to be publically available in August 2018.

  1. Deloitte’s report for the last six months of 2017 is accessible through this link(PDF), in Kurdish, Arabic and English.
  2. Frequently asked questions handbook (PDF) in Kurdish, Arabic and English to help readers better understand different sections of the report.

(Source: KRG)

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Iraq Invests to Boost Nasiriyah Oil Field

By John Lee.

Oil Minister Jabar Ali al-Luaibi [Allibi, Luiebi] has ordered the state-run Dhi Qar Oil Company (DQOC) and Iraq Drilling Company (IDC) to develop the Nasiriyah oil field in Dhi Qar province.

He said the Ministry has budgeted $140 million to raise production from the current 90,000 barrels per day (bpd) to 200,000 bpd within a year.

The field has estimated reserves of 4.4 billion barrels of oil.

It was originally offered as part of a larger project, known as the Nasiriyah Integrated Project (NIP), which would include the contruction of a 300,000 bpd refinery.

In January 2018, Iraq dropped the NIP, saying it will rely on a newly formed state oil company to develop the Nassiriya oil field, and leaving only the nearby refinery project for investors.

(Source: Ministry of Oil)

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AstraZeneca Investigated for Alleged Corruption in Iraq

By John Lee.

UK-bassed pharmaceutical company AstraZeneca has said it is the subject of an anti-corruption investigation in the US relating to its activities in Iraq

In its latest quarterly filing with the Securities and Exchange Commission (SEC), the company said:

“As previously disclosed, in the US, in October 2017, AstraZeneca and certain other pharmaceutical and/or medical device companies were named as defendants in a complaint filed in federal court in the District of Columbia by US nationals (or their estates, survivors, or heirs) who were killed or wounded in Iraq between 2005 and 2009 (the Lawsuit).

“The plaintiffs allege that the defendants violated the US Anti-Terrorism Act and various state laws by selling pharmaceuticals and medical supplies to the Iraqi Ministry of Health.

“In addition, AstraZeneca has received an inquiry from the US Department of Justice in connection with an anti-corruption investigation relating to activities in Iraq, including interactions with the Iraqi government and certain of the same matters alleged in the Lawsuit.“

(Source: AstraZeneca)

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Iraq Plans to take over Mansuriyah Gas Field

By John Lee.

Oil Minister Jabar Ali al-Luaibi [Allibi, Luiebi] (pictured) as ordered Iraq’s state-owned oil companies to devise an urgent plan to develop the Mansuriyah (Mansouriya) gas field, following what he described as the delay and the failure of foreign companies to start developing the field.

The field, in Diyala province, was awarded in the third licensing round in 2010 to a consortium of international oil companies consisting of: Turkey’s TPAO (37.5%), Iraq’s Oil Exploration Company (25%), Kuwait Energy (KEC) (22.5%), and the Korean Gas Corporation (Kogas) (15%).

It holds around 127 billion cubic metres of gas. They committed to produce 320 million standard cubic feet of gas a day for $7 per barrel of oil equivalent produced, the maximum the government would agree to pay.

(Source: Ministry of Oil)

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EU provides Healthcare for Vulnerable Communities

The European Commission for Humanitarian Aid (ECHO) has provided an additional € 4.5 million to the World Health Organization (WHO) to maintain health security and resilience for Internally Displaced Persons (IDPs), returnees and host communities in conflict-affected governorates of Iraq.

This comes on top of the €29.2 million already contributed by the commission since 2015.

This renewed support will be used to sustain health services more than 500 000 vulnerable people in hard to reach and newly accessible areas of Ninewa and Anbar for the coming 12 months and to ensure vigilance for diseases with a potential of causing outbreaks.

The funds will also support to provide necessary essential medicines and medical supplies as well as facilitate referral services for returnees who have limited access to primary healthcare, secondary rehabilitative and referral health services.

ECHO Head of Office in Iraq, Simon Mansfield said:

“ECHO is keen to continue this support of the provision of medical humanitarian assistance in Iraq. Access to essential medical services for displaced populations and assistance for victims of war injuries remain ECHO’s priorities in country. In 2018, ECHO maintains this strategic partnership with WHO”.

WHO’s Representative in Iraq, Altaf Musani said:

“We welcome this additional contribution from our long term partner, ECHO. This contribution will support WHO and health partners to ensure uninterrupted access to essential and rehabilitative health care services for at least 500,000 IDPs, returnees and vulnerable host communities in the country’s most conflict-affected governorates”.

This partnership between ECHO and WHO represents a strong commitment in improving the health of the people of Iraq.

(Source: WHO)

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Iraq Immediate Stabilisation Programming, FY17-18

The Iraq Governance and Security and Justice Programmes are key in delivering the UK’s mission to support the Iraqi Government and people as they build a stable, prosperous and democratic nation.

Working with the Government of Iraq, the UN Mine Action Service (UNMAS) and the UNDP, CSSF funding has helped to rebuild essential infrastructure in areas liberated from Daesh, and cleared it of explosive hazards, enabling over 3.6m people to return home and access basic services, including healthcare, education, water and electricity.

CSSF support to the UNDP-led Funding Facility for Stabilisation, a multi-donor pooled fund, has helped deliver over 1,500 stabilisation projects restoring services and essential infrastructure in liberated areas. UNDP has staff deployed across Iraq, including embedded stabilisation advisors in 10 municipalities to support project planning.

The programme has provided cash for work for both men and women, and stimulated local business through reconstruction contracts. Over 15,000 residents earned a wage whilst restoring their homes and city.

Inclusion is critical to the stabilisation effort—and women have been recruited as engineers, social workers and in local councils. In total over 2,000 jobs and more than 1,000 small business grants have been created for women, and over 1,000 vulnerable women and female headed households have benefitted from cash for work programmes.

As well as the ‘pooled’ Funding Facility for Stabilisation projects, CSSF funding has specifically paid for the rehabilitation of a water plant serving over 300,000 people in Mosul and repaired over 2,000 homes in the city.

In Mosul the UNMAS demining programme has facilitated the removal of more than 585,000 explosive hazards, helping to enable the return of nearly 1 million people. Clearance locations include Al Khansa Hospital in Mosul and four schools in Al Qayarra, helping 1,286 children return to school.

To download the full report from the UK’s Foreign and Commonwealth Office, please click here.

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Rosneft to start work in Duhok

By John Lee.

Rosneft has reportedly sent a delegation to Duhok to discuss starting work on three oilfields next month.

According to the report from Rudaw, the state-controlled Russian company will work at three locations: Batle, Zawita, and in Sarsang and Chamanke in Amedi.

It is expected to extract 180,000 barrels of oil per day.

In October, Rosneft signed Production Sharing Agreements (PSA) with respect to five production blocks in Iraqi Kurdistan.

More here.

(Source: Rudaw)

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KRG Acts against Illegal Refineries

KRG Prime Minister Nechirvan Barzani chaired on Wednesday a meeting of the KRG Oil and Gas Council.

It was also attended by Deputy Prime Minister Qubad Talabani, relevant ministers, governors, supervisors of local administrations, and representatives of the Integrity Commission, Board of Supreme Audit, the Attorney General’s Office, and Security (Assayish).

The Ministry of Natural Resources presented a report on the number and locations of illegal refineries with dates of operation. Because these refineries are a serious threat to citizen health and the environment it was agreed to accelerate control of the situation.

Prominent examples in both Erbil and Suleimaniya Governorates were presented in which refinery residues severely damaged water resources, agricultural production, and adversely affected citizen health.

It was decided the Ministry of Natural Resources in cooperation with the Ministry of Interior and the heads of administrative units would soon work in accordance with law to resolve this issue. The government would take necessary procedures to protect the environment and health of citizens, and later present results of legal proceedings to the public.

Prime Minister Barzani and Deputy Prime Minister Talabani stressed the need for especially the executive administrative units such as the Ministry of Interior, the Security Council, and the police to cooperate with governors to address this issue within the framework of the legal mechanism that was put forward during the meeting.  Also, the Attorney General has been mandated to cooperate on legalities.

They stressed that protection of the environment and preservation of citizens’ lives are priorities that supersede economic issues – a distinction must be made between the lives of citizens, the environment, and the provision of fuel.

(Source: KRG)