Power of Story Send a Tweet        
- Advertisement -
OpEdNews Op Eds

Iraq Oil Output to Rival Saudi Arabia, if"

By       Message OilGuy       (Page 1 of 4 pages)     Permalink

Related Topic(s): ; ; ; ; ; ; ; ; ; ; (more...) ; ; ; ; ; ; , Add Tags  (less...)  Add to My Group(s)

View Ratings | Rate It

opednews.com

Author 40799
- Advertisement -

BAGHDAD - What was once considered a pipe-dream could become reality: after decades of dictatorship, war and international sanctions, Iraq's massive oil reserves are set to be tapped proper and the country once known for two overflowing rivers could be crowned oil king.

If the seven oil projects awarded to foreign oil companies this weekend, and the three from an auction earlier this year, develop as planned, within eight years, Iraq will see its oil production capacity leap to more than 12 million barrels per day (bpd).

"We think it is a big victory for Iraq to be able to be a leader in the world," Iraqi Oil Minister, Hussain al-Shahristani, said after the auction.

- Advertisement -

Saudi Arabia, the world's largest producer at 8.18 million bpd, has a capacity of just over 11 million bpd today, after slower demand growth halted plans to expand to 12.5 million bpd by the end of this year.

Iraq behind Saudi Arabia and Iran has the world's third largest proven oil reserves, with potentially more remaining to be found. Currently, however, its 115 billion barrels below ground pump at just 2.4 million bpd, with production hampered by political, structural and security problems that could moot the enthusiasm from this weekend's auction.

- Advertisement -

Out of the 10 oil projects on offer during the two-day auction, seven were awarded to a dozen companies. Three fields up for grabs in a June 30 auction were awarded, with one deal already finalized. And there are more than 60 fields discovered but not yet developed. These include two that the ministry is negotiating directly with foreign companies outside of an auction process.

Currently, Iraq relies on oil revenue for 95 percent of its revenue. This will increase if the fields develop as planned. Only after, however, Iraq reimburses companies for their investment and pays them a relatively small fee per barrel of increased output.

But this is Iraq, where, aside from this weekend's bidding round, it seems nothing goes according to schedule.

- Advertisement -

Since late 2006, a new oil law to replace current oil governance an often vague and conflicting mix of the 2005 Constitution and laws left from previous eras has been delayed by political squabbles. Laws reestablishing the national oil company, reorganizing the oil ministry and formalizing revenue redistribution, are also languishing.

Next Page  1  |  2  |  3  |  4

 

- Advertisement -

View Ratings | Rate It

opednews.com

I have an interest in the financial markets, commodities and Geopolitics.

Share on Google Plus Submit to Twitter Add this Page to Facebook! Share on LinkedIn Pin It! Add this Page to Fark! Submit to Reddit Submit to Stumble Upon Share Author on Social Media   Go To Commenting

The views expressed herein are the sole responsibility of the author and do not necessarily reflect those of this website or its editors.

Writers Guidelines

Contact AuthorContact Author Contact EditorContact Editor Author PageView Authors' Articles
- Advertisement -

Most Popular Articles by this Author:     (View All Most Popular Articles by this Author)

Africa's Increasing Importance in Worldwide Energy Security Affairs

The Myth Of Nabucco: Greed, Delusion and $11.4 Billion

Government Insiders: Get Ready for the Gulf Dead Zone

They Died Before the Oil Ran Out

The Great Geopolitical Battle Over Energy Transit Routes

Canada's Oil Sands Set to Become Biggest Source of U.S. Oil Imports, Report Says