The Ministry: We want to invest in our “forgotten” fields Academics: The government is trying to pas

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[size=52]The Ministry: We want to invest in our “forgotten” fields Academics: The government is trying to pass oil contracts that we rejected in 2018[/size]

[size=45]The Ministry to the “People’s Way”: We want to invest our “forgotten” fields[/size]
[size=45]Academics: The government is trying to pass oil contracts that we rejected in 2018[/size]
[size=45]Finally, the government of Prime Minister Muhammad Shia'a al-Sudani signed contracts for the fifth licensing rounds, which a number of oil experts renewed their rejection of.[/size]
[size=45]A number of those interested in the oil issue expressed their rejection of these contracts in 2018 when the government of Adel Abdul Mahdi proposed them, for many reasons, including those related to the type of contracts and the companies’ control of all aspects of the oil process and profits.[/size]
[size=45]Many gaps and problems[/size]
[size=45]Dr. Nabil Al-Marsoumi, an economist and academic expert at Al-Maqel University, says that the rejection of contracts for the fifth licensing round by oil experts is not new. Rather, it has been since 2018 and dates back to the time of the government of Adel Abdul-Mahdi when the initial contracts were signed and not implemented, and today they returned again in the government. Sudanese.[/size]
[size=45]He explained by saying in his interview with “Tariq al-Shaab” that the main objection “relates to the type of contracts, as they are production-sharing contracts even if they are camouflaged and covered as profit-sharing, which is considered the critical face of production-sharing contracts, which Iraqi politicians criticize on both sides, as well as Kurdistan because it includes neglecting an important part of the oil revolution.[/size]
[size=45]He cited the participation contracts in the Kurdistan region in 2022, saying: “If we take it as a model, then 56 percent of oil sales went to foreign companies, and 44 percent to the regional government, meaning that 12 billion dollars of the total revenues were the share of Kurdistan, of which 5 billion dollar".[/size]
[size=45]He pointed out that "when these contracts are implemented, they become close to oil concession contracts, which the world left a long time ago."[/size]
[size=45]He pointed out that foreign companies “have the upper hand in this type of contract, and they decide the level of production and the size of costs, meaning that they control all aspects of the oil process. Yes, it will bear all the investment, adventure and risk, but as a result the fields that Iraq signed on are not exploratory patches, they are explored fields, and the development process is taking place in them like the Sinbad field in which 6 exploratory wells were drilled, and in some fields productive wells were drilled except for the Khadr patch. Mayi.”[/size]
[size=45]Al-Marsoumi stressed that this type of contract “is usually signed in countries where the degree of adventure and risk is great, and therefore the rate of finding oil is limited, but the reality is different in Iraq, as these five fields are on the border with Iran, and it is proven that there is oil in them, and all the wells The exploratory excavations prove and confirm this, and some of them are mainly productive fields, except for the Khidr al-May patch, which is located on the Kuwaiti-Iraqi border.[/size]
[size=45]He pointed out that "some incorrect examples are given that are intended to delude the Iraqi citizen that the share of the Iraqi government will become 80-85 percent, and this is incorrect, because the problem with these contracts is that oil[/size]
[size=45]The cost is high, meaning that when the foreign company spends on the fields and after paying an oil revenue of 25 percent to the government, you get 70 percent of it, and when we applied this model, we found that the Iraqi government gets less than half.[/size]
[size=45]The expert explained that “perhaps in the near future this contract will be challenged in the Federal Court, especially since there are loopholes, including that the Emirati Crescent Company is the largest shareholder in Dana Gas, and the latter was blacklisted by the Ministry of Oil,” pointing out that “it was supposed to activate the investment National in this type of contract, by investing part of the cash surplus available to Iraq, in a real internal investment process that leads to the development of the oil and gas production sectors in Iraq, instead of entering into such type of contracts.[/size]
[size=45]important priorities[/size]
[size=45]For his part, the economist d. Abd al-Rahman al-Mashhadani: “We are talking about 6 fields; Four of them are common fields with Iran and Kuwait, and these common fields have been exploited by neighboring countries. For years, you have invested in the trunk they have. While the bulk of these fields are located in Iraqi territory.[/size]
[size=45]He continued his speech to “Tariq al-Shaab” by saying: “It is assumed that” an agreement will be reached in the joint fields on the investment process, and each party will withdraw according to its share, or an international company will be brought in to invest and distribute the shares according to maturity. Either the other side will dig and we will remain without anything. This is unfair to the Iraqi side.”[/size]
[size=45]Al-Mashhadani noted that "this point is the most important positive in the contracts of the fifth licensing rounds, that is, we must invest in common fields, as long as the other side invests and withdraws 10 years ago, while the amount of reserves is limited, this means that it took from the share of the Iraqi side as well."[/size]
[size=45]He pointed out that the contracts of licensing rounds “despite all the observations on them, they added to production outside the capabilities of the state, because we basically do not have the capital with which we work. The years of the blockade led to the destruction of many facilities; In 2008, the maximum production reached 2 million barrels, and later it reached 5 million barrels. The government failed because the production ceiling did not reach 12 million barrels, as was its ambition.[/size]
[size=45]And in the context of his speech, Al-Mashhadani stated that what is required today is “after the completion of the four rounds and we are in the fifth round, we had national oil companies adopting drilling operations, marketing, transporting and distributing oil, and we are supposed to rebuild these facilities because from the seventies until 2003 we were relying on effort National in drilling wells, and now even foreign companies are contracting with Iraqi companies in some joints of drilling and exploration operations, and we are also supposed to have a national transportation fleet to transport oil instead of paying costs to others.[/size]
[size=45]oil returns..[/size]
[size=45]The “People’s Way” contacted the Ministry of Oil and put the oil experts’ problems on its table to inquire about the ministry’s opinion on them, and to express its point of view on this matter.[/size]
[size=45]And the official spokesman for the Ministry of Oil, Issam Jihad, replied, “We have benefited from the experience of previous contracts, and these contracts are contracts on border fields, and they were abandoned, and what distinguishes them is that they contain exploratory patches and oil fields; The exploratory patches turn into productive ones, and there may be structures - gas fields - while the producing oil fields will be developed and production increased.[/size]
[size=45]And Jihad added in an event dedicated to “Tariq al-Shaab,” saying: “It is expected, according to preliminary estimates, that the fields will provide us with 800 to 1,000 million standard cubic feet per day, and these numbers may also change with the entry of these fields into production, and they will provide up to 250 million standard square feet per day.” thousand barrels per day of crude oil.[/size]
[size=45]Jihad stressed that the investment factor needs “political, security and economic stability, and these fields are border, and in some of them there is a security concern that may be witnessed from time to time.” The ministry considers the public interest. Yes, there may be observations by some experts, and this is appreciated, but international companies need to give them incentives and encouragement so that they can invest better than the fields remaining without development.[/size]
[size=45]And he noted that “if better offers came than these, we would have accepted them. In the previous round, we offered 11 sites, and only 6 sites were referred, and therefore the investing companies also think about factors of risk, profit and stability. The companies’ estimates are not like ours, so how long do we keep taking notes and postponing them?” While Iraq is losing billions as a result of disruption or delay in directing these sites?[/size]
[size=45]Jihad pointed out that his ministry took into account “the issue of risk in these contracts, as the previous contracts did not set conditions in the price ceiling, if oil prices fell and otherwise, while even if oil prices fell, this matter was dealt with in the new contracts, while giving an incentive to companies, Due to the privacy of these sites.[/size]
[size=45]Muhammed
Al-Tamimi[/size]
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