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Turkmenistan and Iran sign agreement on gas supplies to Iraq

Turkmenistan and Iran have signed a contract for the annual supply of 10 billion cubic metres of Turkmen gas, which Iran will transfer to Iraq under the SWAP programme, Trend reported. The agreement was announced by Turkmenistan’s Foreign Ministry, but the monetary value of the contract was not disclosed. The agreement is the result of years of cooperation between Turkmenistan and Iran in the gas sector. According to the ministry’s statement, Iranian companies will build a new 125-kilometre pipeline to Iran to increase gas supplies from Turkmenistan. Ashgabat plans to increase gas supplies to Iran to 40 billion cubic metres per year in addition to the existing capacity. It is planned to increase the volume of gas supplied through Dovletabad-Serakhs-Hangeran and through the Chaloyuk gas metering station. The agreement on gas supplies to Iraq was signed by Iranian Ambassador to Turkmenistan Ali Mojtaba Rouzbahani and President of the State Company “Turkmengaz” Maksat Babayev. Based on the swap agreement (SWAP) between Turkmenistan and Iraq, Iran will supply up to 10 billion cubic metres of gas to Baghdad in exchange for the same amount of gas from Ashgabat. Last year, Iraq faced disruptions in the supply of Iranian gas, which accounts for about 40 per cent of its imports. Turkmenistan relies heavily on exports of its vast natural gas reserves. China is the main consumer of Turkmen gas and work is underway on a pipeline to supply gas to Afghanistan, Pakistan and India.

Lebanon plans to rely on Iraqi fuel despite unpaid bills and cheaper alternatives

(The National) Lebanon could become reliant on a complex arrangement to import Iraqi fuel for its electricity needs, despite the lack of an agreed repayment plan. The scheme, which experts say is fraught with problems, could lock the country into an unstable arrangement while delaying its transition to renewable or affordable energy sources, new documents and interviews reveal. Lebanon, a country which has few natural resources and is suffering from an economic crisis, imports heavy fuel oil from Iraq under a swap deal signed in 2021. Because the heavy fuel supplied by Iraq does not meet Lebanon’s fuel specifications, the deal allows Beirut to swap it on the international market for other types of oil suitable for its power plants, through traders who make a profit. But three years after the deal was signed, Lebanon has yet to pay Iraq for the oil received. This is partly due to the unclear terms of the agreement. The contract, seen by The National under a freedom of information request, states that Lebanon will deposit funds in a dollar account that Iraq can withdraw in Lebanese pounds to spend on “goods and services” for its ministries, such as medical services. But the exchange rates at which Iraq will access the funds as well as the exact nature of services are unclear. As a result, Iraq has yet to access the $550 million worth of goods or services, the value of the first year’s imports, deposited in Lebanon's central bank. The deal also leaves Lebanon reliant on fossil fuels as it swaps the Iraqi heavy oil for gas oil and low-sulphur fuel oil, rather than cheaper alternatives such as natural gas, or cleaner renewables. Despite these issues, new documents suggest that Lebanon plans to rely on the Iraqi fuel deal being renewed for its energy supply until at least 2028. Stalled reforms The National has seen Lebanon's National Emergency Plan for the Electricity Sector, written by the Ministry of Energy and Lebanon’s state electricity company, Electricite du Liban. It was put together as an alternative to the country's 2022 energy plan, which has not yet been implemented amid delays in the wider package of reforms to Lebanon's governance and economy demanded by international lenders in return for vital funding. The plan reveals that EDL intends to increase the volumes involved in the deal with Iraq to $772 million per year. This is part of its plan to boost capacity production from four hours to eight hours per day by 2028. According to calculations, this will increase the total bill owed to Iraq to $5.45 billion by 2028, and leave Lebanon mainly reliant on fossil fuels, without guaranteeing 24-hour electricity for residents. This comes despite the Iraqi government not having committed to extending the contract. “The Iraqi fuel deal is a ticking time bomb with no alternative fuel source. The contract is due to end in October and the Iraqis will want to know why they haven’t received anything in return,” said a Lebanese energy professional and former ministerial candidate, who did not want to be identified. Even if Lebanon were able to pay and secure an extension of the deal, experts have expressed concern over the lack of planning to secure alternative, cheaper and greener sources of fuel. Lebanese households, despite being promised reliable electricity for more than a decade, continue to face daily blackouts and are forced to pay for expensive and polluting diesel generator subscriptions. 'Temporary fix' The Beirut-Baghdad deal signed in 2021 was initially portrayed by Lebanese authorities as a gift from Iraq – a sign of solidarity towards a fellow Arab country grappling with an unprecedented economic crisis. At the end of 2020, a tainted fuel scandal over another fuel import agreement shook the country. What Lebanese authorities had presented as a state-to-state fuel import contract with Algeria was shown instead to involve secretive offshore companies charging exorbitant prices for low-quality fuel. The revelations further exposed a network of corruption involving contaminated fuel shipments, falsified laboratory tests and endemic bribery of state officials. Following the scandal, this fuel supply contract was not renewed and Lebanon was left without a fuel supply contract for the first time since 2005. Struggling to find a replacement willing to engage with its cash-strapped economy, Lebanon signed the Iraqi deal in July 2021 for one million tonnes of fuel oil, or about seven million barrels. It was extended in 2023 for one more year for two million tonnes, this time with a small volume of crude to be swapped alongside the heavy fuel oil. Overall, Lebanon receives around half of the original fuel oil exported by the Iraqis, according to official documents from the Ministry of Energy and Water. “It did help Lebanon at the time as a temporary fix when the government defaulted on its debt and couldn't access international markets,” said Marc Ayoub, associate fellow at the American University of Beirut’s Issam Fares Institute. However, experts have since expressed concern over a range of issues linked to the deal, especially regarding the absence of an alternative and clear financial arrangements in a country known for its corruption-riddled electricity sector. Payment issues Under the terms of the contract, Lebanon has one year to pay for each fuel shipment, but three years since the deal was signed, Iraq has not received anything, and it remains to be seen how Beirut will pay. Lebanon already owes Iraq about $1.59 billion for millions of tonnes of fuel already imported since 2021, according to figures from the Ministry of Energy and Water. The bank account assigned to the Iraqis at the BDL contains $550 million, the value of the first year’s imports. The Iraqi government has not yet accessed the funds, which are denominated in dollars but supposed to be withdrawn in Lebanese pounds. The exchange rate for this withdrawal is unclear under the terms of the contract. According to the contract, Lebanon would pay Iraq using the market rate at a 15 per cent discount or the Sayrafa platform rate, the exchange rate platform set up by the BDL between 2021 and 2023 to stabilise the Lebanese currency as it depreciated on the black market. Criticised for its lack of transparency, the platform was phased out with the arrival of the new central bank governor in 2023. Moreover, the “goods and services” that the Iraqis are supposed to access in Lebanon with these funds have yet to be determined, and Iraq has yet to receive any, despite media reports of medical services being provided. An Iraqi Health Ministry official told The National that the medical services “are only on paper and nothing has happened in this regard”. The responsibility for determining payment mechanisms and services provided lies with the Investment Development Authority of Lebanon, the Lebanese investment promotion agency charged with acting as the organisation for working with Iraq. IDAL did not respond to interview requests from The National. Energy security Experts have also expressed concern about the deal’s implications for Lebanon’s energy security. Mr Ayoub warned against a “fuel dependency” on Iraqi gas oil and fuel oil, currently the only energy source available to Lebanese power plants. “Maybe the Iraqi government will decide one day to stop the contract, what alternative do we have?” he said. But the government appears to think that its diplomatic relations with Iraq will outweigh any potential financial disagreements, as the emergency plan relies largely on the assumption that the contract will be renewed. Asked about a contingency plan should the deal not be renewed, EDL appeared to have few plans beyond repairing its damaged power stations to boost their efficiency. “[EDL] has put in place a scenario where it will attempt to extend generation as much as possible until the matter of supply is resolved," the company said. "This involves measures for the optimisation of generation efficiency to mitigate any potential disruptions in fuel supply.” Long-term solutions? Initially seen as a temporary fix, the Iraqi deal now appears to be emerging as a long-term solution. Its extension, according to the emergency plan, would see EDL gradually assume responsibility for paying for fuel from Iraq rather than the Ministry of Energy, which has so far covered the cost. EDL said that the dramatic tariff increases initiated in 2022 would enable it to cover the cost of Iraqi fuel. Yet experts questioned the rationale behind EDL’s decision. “Now that EDL has increased its tariff and can pay for its shipments, it could move away from the Iraqi deal and look at cheaper and alternative sources of energy and invest in renewables,” said Rony Karam, president and founding member of the Lebanese Foundation for Renewable Energy. The emergency plan envisages renewable energy accounting for only 12 per cent of total production by 2028 in its best-case scenario, appearing to revise downwards the Ministry of Energy and Water’s earlier goal of 30 per cent by 2030. Given current fuel costs, electricity must be produced at $0.20-0.25 per kilowatt hour. Yet Mr Karam highlighted the possibility of generating electricity using natural gas, which is much less polluting and could be produced for a third of the price at $0.07 to $0.08. “This will make EDL more profitable and more bankable and instil confidence among international donors,” he added. EDL's chronic losses, averaging $1.5 billion per year, have historically been the result of its expensive fuel supply. A recent study by the World Bank, the Lebanon Country Climate and Development Report, estimated that replacing fuel with natural gas and large solar installations could reduce the cost of electricity by 66 per cent in Lebanon. In 2022, Lebanon, Syria and Egypt signed a gas import agreement to import Egyptian gas through Syria in a bid to add four extra hours of power per day to the grid. The project remains mired in geopolitical challenges, with the emergency plan revealing that Egyptian natural gas is not expected to come online until at least 2028. Under the original reform plan, Lebanon was supposed to have already begun weaning itself off fossil fuels. In previous statements, caretaker Minister of Energy Walid Fayad blamed the delays on the lack of reform to the country’s financial system's and continuing lack of investment appetite, leaving the Iraqi deal as the only option.

There is no indication that the post of governor of Kirkuk will be decided soon

There is no indication that the post of governor of Kirkuk will be decided soon and the political parties are waiting for Sudani to organize a new round of negotiations. According to the newspaper (Al-Araby al-Jadeed), political sources in Kirkuk province hope that the Iraqi prime minister will organize a new round of talks between the political forces in the province to discuss the crisis of the governor's post and try to reach an agreement. According to the newspaper, several scenarios have been proposed to resolve the crisis, including the post of governor for two years to be divided between Kurds and Arabs, another scenario is that the post is Arabs in exchange for important posts to Kurdish parties. It said there is no indication that the issues will be resolved soon, but the new attempt of Sudani is part of Baghdad's efforts to resolve the issue of the posts of Kirkuk and Diyala provinces. According to the newspaper, the risks of failure of a new round of negotiations, the Iraqi government as the highest authority can appoint a governor for Kirkuk outside the political forces, but this will be the last option.

Oil firms in Kurdistan deny Iraqi PM's contract claims

Argus The Association of the Petroleum Industry of Kurdistan (Apikur) has denied claims by Iraq's prime minister Mohammed Shia al-Sudani that international oil companies (IOCs) operating in the country's semi-autonomous Kurdistan region are not ready to amend their contracts. Apikur points to a statement it made last week that said its members would be willing to consider modifications to existing contracts provided the matter is agreed by Iraq's federal government, the Kurdistan Regional Government (KRG) and the firms themselves. Baghdad had proposed a middle ground agreement that would see it amend its federal budget to allow it to pay IOCs operating in Kurdistan, in return for a compromise with the KRG and the IOCs over the recovery cost for oil produced in the Kurdish region. In an interview with Turkish state news agency Anadolu published on 31 May, al-Sudani said his government has agreed to amend the budget law but IOCs operating in Kurdistan are refusing to amend their existing contracts with the KRG. "We have initiated acceptable settlements and legal solutions after a thorough legal study… The federal budget law requires that the cost of producing one barrel of oil in all fields be within the national average production cost, which is about $8/bl, according to the federal oil ministry," al-Sudani said in the interview. "But the KRG's ministry of natural resources calculates the production cost at about $26/bl within the contracts signed with the operating oil companies," he added. "For these reasons, more work is needed to find a legal solution that prioritises ensuring the rights of Iraq and its people to their wealth." His remarks suggest the two sides still have a significant gap to bridge on this issue. It also pours cold water on a recent call by Iraq's oil ministry for a meeting with its Kurdish counterpart and the IOCs to try to reach a deal and accelerate the restart of northern Iraqi crude exports via Turkey's Mediterranean Ceyhan port. Around 470,000 b/d of crude exports from Iraq's semi-autonomous Kurdistan region have been absent from international markets since March 2023 when Turkey closed the pipeline linking oil fields in northern Iraq to Ceyhan. That move followed an international tribunal ruling which said Turkey had breached a bilateral agreement with Baghdad by allowing Kurdish crude to be exported without the federal government's consent. Iraq's federal government is finding it difficult to strike a balance between repairing its rift with the KRG and complying with its Opec+ commitments. It recently submitted a plan outlining how it will compensate for producing above its target in the first quarter. Opec and the wider Opec+ group are holding ministerial meetings today to discuss output targets and whether to extend the group's current voluntary crude supply cuts into the second half of the year and possibly beyond.

The Iraqi and Kurdistan Regional Governments will not comply with the implementation of national laws

Iraq is failing to implement its national laws ensuring employment rights for people with disabilities, leaving job quotas for Iraqis with disabilities unfilled and hundreds of thousands unemployed, Human Rights Watch said today. Both federal Iraq and the Kurdistan Regional Government (KRG) have laws setting a minimum quota of 5 percent of public sector jobs for people with disabilities. A representative from the Iraqi Federal Public Service Council, the governmental body that regulates public employment, told Human Rights Watch that the public sector has not met the quota. Figures on public sector employment for people with disabilities provided to Human Rights Watch by a representative of the KRG show that the authorities there are also not meeting this quota in the public sector. “Legal promises to employ people with disabilities in Iraq are not translating into real job opportunities,” said Sarah Sanbar, Iraq researcher at Human Rights Watch. “The gap between law and practice leaves hundreds of thousands of Iraqis with disabilities struggling to earn a living.” Between December 2023 and March 2024, Human Rights Watch interviewed three disability rights activists, six Iraqis with disabilities, one sign language interpreter, one business owner who employs people with disabilities, and three government employees about the right to employment for Iraqis with disabilities. In 2019, the Committee on the Rights of Persons with Disabilities, which monitors the international treaty, estimated that Iraq had one of the largest populations of people with disabilities in the world, at around 3 million people, a result of decades of armed conflict. The 2019 protests have also left some 25,000 people wounded, of whom some 5,000 live with permanent disabilities. In federal Iraq, Law No. 38 of 2013 allocates 5 percent of public sector and 3 percent of private sector jobs to people with disabilities. In the Kurdistan Region of Iraq (KRI), Law No. 22 of 2011 also allocates 5 percent of public sector jobs to people with disabilities and encourages private sector employment of people with disabilities by covering half of the employees’ salary for 3 months. The Iraqi government does not collect statistics on the number of people with disabilities living in the country or their employment rate. Local disability rights groups in federal Iraq told Human Rights Watch that they blame the lack of implementation of Law No. 38 of 2013 on the inaction of the Commission on the Care of People with Disabilities and Special Needs, a body under the Ministry of Labor and Social Affairs tasked with ensuring the law’s implementation. While the Commission bears the primary responsibility for implementing Law No. 38, it is unable to do so alone. Dhikra Abdel Rahim, the director of the Commission, told Human Rights Watch that the Commission and the Federal Public Service Council lack enforcement authority and have to depend on government ministries to allocate and fill the required number of jobs for Iraqis with disabilities. Some ministries are not carrying out their obligations or making them a priority, she said, though the Commission is considering pursuing legal action against ministries that fail to comply. In the private sector, employers who fail to comply with the 3 percent employment quota are subject to 500,000 Iraqi dinars (approximately US$382) fine, under article 20 of Law No. 38. However, no fines have ever been issued, Abdel Rahim said. The KRI has 77,065 people registered as having a disability, 13,249 of whom are employed in the public sector as of the end of 2022, according to a document shared with Human Rights Watch by Dindar Zebari, the KRG’s coordinator for international advocacy. That is only 2 percent of the total 658,189 government employees, well below the 5 percent quota mandated by Law No. 22 of 2011. In the KRI private sector, too, compliance with Law No. 22 is inadequate. Dileer Koy, an advocate and human rights defender for people with disabilities in the KRI, told Human Rights Watch that he tries to persuade companies and private project managers to hire people with disabilities but often without success. “Employers are often reluctant to integrate people with disabilities into their work forces due to perceived higher costs in creating accommodating work environments,” Koy said. “Additionally, there is a lack of governmental pressure to compel these companies to hire people with disabilities.” Zebari did not share numbers with Human Rights Watch on the number of people with disabilities employed in the private sector. The Iraqi government should take appropriate steps to employ people with disabilities in the public sector and promote their employment in the private sector, for example through affirmative action programs, incentives, and initiatives to foster meaningful employment opportunities for people with disabilities. The government should establish monitoring mechanisms for ministries to periodically report on their performance in meeting the employment quota and their other obligations under Law No. 38 and Law No. 22. Quotas themselves are often insufficient to dismantle or address barriers to employment faced by people with disabilities, and as such should be paired with enforcement of other nondiscrimination and equality legislation as well as support and funding for creating accommodating work environments, Human Rights Watch said. “Despite having one of the largest populations of people with disabilities in the world, Iraqi authorities are failing to meet their needs,” Sanbar said. “The government should make sure their commitment to providing job opportunities for Iraqis with disabilities isn’t an empty promise.” Law No. 38 in Federal Iraq Several ministries are failing to fill their obligations under Law No. 38, Human Rights Watch said. For example, the Iraqi Ministry of Planning does not regularly collect statistics on the number of people with disabilities living in the country, despite being required to under article 15(9) of Law No. 38, and despite repeated requests from the Commission to do so, Abdel Rahim said. The Ministry of Labor and Social Affairs does not collect statistics on the employment rates of Iraqis with disabilities in the public or private sector, either. About 5 million Iraqis, or 39 percent of Iraq’s workforce, are employed by the public sector. To meet the legally mandated 5 percent quota, at least 250,000 of those jobs should be held by people with disabilities. Though there is no exact figure on how many Iraqis with disabilities hold public sector jobs overall, no ministry had met the 5 percent quota, according to a document shared with Human Rights Watch by a representative from the Federal Public Service Council. The Commission on the Care of People with Disabilities and Special Needs began tracking appointments in 2019, and since then just 1,434 people with disabilities have been hired for positions in the public sector, Abdel Rahim told Human Rights Watch. “When we request the Federal Public Service Council to employ more people with disabilities, they often respond that there aren’t enough job opportunities,” Muwafaq Al-Khafaji, head of the Iraqi Alliance of Disability Organization (IADO), told Human Rights Watch. In September 2023, the Commission opened a direct employment platform in cooperation with the Council to facilitate hiring university graduates with disabilities. The Council also allocated a field in the general public sector electronic application form where candidates can indicate their disability status. Nobody has yet been employed through this platform, Abdel Rahim said. Activists’ Role: A Success Story Absent strong government action, local disability rights activists have taken it upon themselves to push for more employment opportunities for Iraqis with disabilities in the public and private sectors. Muwafaq al-Khafaji, head of the Iraqi Alliance of Disability Organization (IADO), runs workshops to educate public and private sector employers on employment rights for people with disabilities, and to encourage them to hire people with disabilities. Following one such workshop, Muhammed Ali al-Mayahi, chief executive officer of the Bab al-Agha Bakeries company in Baghdad, decided to heed al-Khafaji’s call to action. “In the beginning, we hired five deaf employees, and they worked continuously. We saw they were doing very well, so we hired five more employees to make it ten. Now we've almost reached 30 deaf employees, and we’re still hiring,” Al-Mayahi told Human Rights Watch. “Their competence and energy are very high. We must ensure that these people can live their lives just as everyone else here in Iraq. I hope that all companies will follow our example.” Al-Mayahi also hired Fatima Mohammed, 22, to work as a sign language interpreter for the employees. Fatima learned sign language from her deaf parents, inspiring her advocacy for the rights of people with disabilities. “In the beginning, there were communication challenges between the hearing and deaf people,” Fatima said. “But they [hearing people] began to learn sign language, and now they communicate with the deaf employees even when I am not around!” Deaf employees at Bab al-Agha told Human Rights Watch that their employment has had a tremendously positive impact on their lives. “Since I was hired here, my life has changed,” Shaima, 24, told Human Rights Watch. “Today, I can communicate with people, make a living, and rely on myself.” “We hope to break open all the barriers in front of us,” Shams, 28, said. “We know we are smart and can do all types of work, but many people think we are incapable of work. We are grateful to Bab al-Agha for seeing that we are diligent and capable of working and achieving our goals.” To promote greater private sector compliance with this law, Khafaji suggested fining employers who fail to meet the quota, linking the issuance or renewal or business licenses to compliance with the 3 percent employment quota, and awarding benefits and incentives to the private sector for hiring people with disabilities, such as tax exemptions. Law No. 22 in the Kurdistan Region of Iraq (KRI) People with disabilities in the KRI are registered by the Ministry of Labor and Social Affairs and issued an ID card that allows them to apply for a monthly payment of 100,000 Iraqi dinars (approximately US$76) if they are employed or 150,000 Iraqi dinars (US$115) if they are unemployed. As a result of ongoing budgetary disputes with Baghdad that have inhibited the Kurdistan Regional Government’s ability to pay out salaries and social benefits, people with disabilities in the KRI do not consistently receive this monthly payment. During a significant public employment initiative in 2013, Koy urged the Ministry of Planning to respect the 5 percent quota, which would have meant allocating about 250 of those new jobs to people with disabilities. Koy said the Ministry of Planning told him that fewer than 10 people with disabilities were ultimately hired. Absent enforcement measures, nothing more could be done to require the Ministry of Planning to comply with the quota, he said. Farhan Shamo, a 34-year-old with a physical disability living in a displacement camp in Dohuk, told Human Rights Watch that that after completing high school in 2007 he enrolled in the political science college at Mosul University, but was not able to complete his studies because of challenges including accessing university buildings. Despite applying for numerous jobs in both the private and public sectors since then, Shamo has been unsuccessful. “I know there is a law guaranteeing access to employment for people with disabilities,” Shamo said. “But when public sector vacancies arise, I apply like any other person.” Failing to fill employment quotas means hundreds of thousands of Iraqis with disabilities, like Shamo, struggle with unemployment. Enforcing Employment Quotas The Iraqi constitution provides that all citizens have equal rights and duties, and guarantees everyone with a disability the right to freedom from all forms of discrimination, providing them with opportunities to develop their capabilities and engage in the development of society. Article 27 of the Convention on the Rights of Persons with Disabilities (CRPD), ratified by Iraq in 2013, mandates state parties to recognize the right of people with disabilities to work on an equal basis with others, including the opportunity to gain a living by work freely chosen or accepted in a labor market and work environment that is open, inclusive, and accessible. To achieve this, governments should take appropriate steps to employ people with disabilities in the public sector and promote their employment in the private sector. These may include affirmative action programs, incentives, and various initiatives to foster meaningful employment opportunities for persons with disabilities. Employment quotas may be used as a form of affirmative action to promote equality of opportunity for people with disabilities and their right to work. However, quotas themselves are often insufficient to dismantle or address barriers to employment faced by persons with disabilities and should be paired with enforcement of other nondiscrimination and equality legislation, to avoid tokenism and segregation of people with disabilities in the workplace.

Iraqi government approved a recommendation to supply gas from the Khor Mor field to the Kirkuk gas power plant

The Iraqi government is considering purchasing gas from the Kurdistan region's Khor Mor gas field following another attack on the field this week. The Khor Mor gas field, developed by the UAE's Dana Gas company, plays a vital role in supplying power to almost 80 per cent of the Kurdistan region's power plants. However, a recent drone attack led to disruption, as confirmed by local electricity authorities, resulting in the loss of 2,500 megawatts of electricity. On 26 April, a suicide drone struck the Khor Mor gas field in Sulaimaniyah province, leading to the death of four Yemeni nationals and injuries to two others. Late Monday night, the field faced another attack with two suspected drones. Kurdish guards responded by firing machine guns towards the objects, according to a reliable source who spoke to The New Arab on condition of anonymity. Despite the attacks, the Iraqi government reportedly aims to purchase gas from the field without the consent of the Kurdistan Regional Government (KRG), seeking approval solely from the ruling Patriotic Union of Kurdistan (PUK), the de facto ruler in Sulaimaniyah province. The source emphasised that procuring gas locally from the gas field entails lower costs than importing it from neighbouring Iran. In response, the KRG's Natural Resources Ministry emphasised on Wednesday that gas extracted from the Khor Mor field cannot be traded without prior approval from Erbil. This announcement comes as the Iraqi government recently approved plans to supply gas from the field to a power plant in Kirkuk during a cabinet session on Tuesday. The Natural Resources Ministry reiterated that as per the contract with Pearl Petroleum, gas from the field is reserved for the Kurdistan Region's electricity sector. "Any volume of gas produced must not be distributed without the express consent of the Kurdistan Regional Government," the ministry stated. US sanctions targeting Iranian oil and gas have hindered Iraq's ability to make payments for these imports, resulting in substantial arrears. In response, Iran has frequently retaliated by intermittently cutting off gas supplies. According to Dana Gas, the Khor Mor gas field produces over 500 million standard cubic feet of gas per day, serving as the primary gas source for power plants in the Kurdistan Region. However, pro-Iran militia factions have intermittently targeted the field, causing disruptions in electricity generation. This development comes at a critical time for Dana Gas, which secured US$250 million in financing from the US International Development Finance Corporation in September 2021 to expand gas production at the Khor Mor plant. However, the recent suspension of operations poses challenges to meeting project timelines. Enerflex, overseeing the expansion project, has withdrawn all staff and suspended operations following the drone attack. Similarly, nearly 3000 workers from the Turkish subcontractor, Biltek company, have been withdrawn. Efforts to obtain comments from Dana Gas and Biltek companies were unsuccessful at the time of this report. Despite the setbacks, both companies remain vigilant and are eager to resume operations once security conditions improve. However, the exact timeline for resuming operations remains uncertain. While the expansion project itself was not directly affected by the drone attack, delays may occur due to the suspension of operations at a nearby gas-collecting facility.

Iraq's oil and non-oil revenues

The Iraqi Ministry of Finance announced its revenues and expenditures for the third quarter of this year. 🔹 Until March 2024, the total revenue of the Iraqi Ministry of Finance, including both oil and non-oil revenues, was about (31 trillion and 223 billion) dinars. About 27 trillion and 689 billion dinars accounted for 89% of the total revenue was oil-dependent and about 3 trillion and 534 billion dinars accounted for 11% of the total revenue was non-oil revenues. 🔹 The total expenditures of the Ministry, including both expenditures (operation and investment), was more than (25 trillion and 77 billion) dinars, of which (92.4%) was for operational expenditures and (7.6%) for investment expenditures. 🔹 After deducting all expenditures from the total revenue of the Ministry of Finance, revenue exceeded expenditure by (19.2%) and revenue overflowed by (6 trillion 145 billion and 710 million) dinars. 🔹 More than (2 trillion and 223 billion) dinars were spent by the three presidencies, the House of Representatives more than (127 billion and 507 million) dinars, the presidency about (13 billion and 115 million) dinars and the Council of Ministers more than (2 trillion and 82 billion Dinars).

Iraq's latest oil bid round will draw China closer

The National Iraq’s latest oil and gas bidding round shows China’s growing influence in the Arab country’s energy sector, which faces challenges such as stagnant production and underdeveloped gas reserves, analysts say. In a three-day licensing round, 29 projects were made available for bidding across central, southern and western Iraq, and also included an offshore exploration block in the country's Arabian Gulf waters. By the end of the third day, only 13 projects were awarded, with 10 of them going to Chinese companies such as Zhongman Petroleum and Natural Gas Group, UEG and Geo-Jade. Most analysts were not surprised by the significant Chinese participation and the conspicuous absence of western oil majors, who have been pumping oil in Iraq for several decades. “With its huge investments in Iraq’s oil industry, China establishes a huge new source of oil for its economy. Moreover, it will do its utmost to prevent American oil majors from returning to Iraq,” said Mamdouh Salameh, an oil economist. “Western oil majors decided to remain on the sidelines partly to stop Iraq buying Iranian gas and mostly because of lack of transparency in Iraq,” Mr Salameh told The National. Iran, which has been facing international sanctions over its nuclear programme, is a major supplier of natural gas to Iraq, which uses the fuel for its power stations. Entities from Europe, the Gulf region, the UK, and Russia also remained “conspicuously absent” from the bidding process, Mahmood Baban, research fellow at Rudaw Research Centre, told The National. “Factors contributing to this included concerns over asset protection…and strategic shifts towards renewable energy investments among European nations,” Mr Baban said. Iraq began to attract international oil companies (IOCs) after the security situation in the country stabilised in 2008. Among major oil companies were ExxonMobil, Shell, the UK’s BP, China’s CNPC and Russia’s Lukoil. Since then, Iraq has awarded dozens of oil deals to develop major fields that hold more than half of its 145.02 billion barrels of proven reserves. Deals to tap natural gas resources have also been awarded. Iraq’s oil ministry plans to increase production to 6 million barrels per day in the next five years, from about 4 million bpd currently. It exports around 3.3 million bpd. China, the world's second-largest economy, is the biggest buyer of Iraqi crude, importing about 1.18 million bpd, which is more than a third of Iraq's total crude exports, according to S&P Global. “Chinese companies already dominate Iraq’s upstream sector, and the two countries enjoy strong diplomatic and trade ties. China is Iraq’s biggest crude market. So, there are plenty of synergies here,” said Vandana Hari, chief executive of Vanda Insights. In 2021, China’s state-run Sinopec energy company won a deal to develop a major gas field in eastern Iraq. A contract was signed to develop the 4.5 trillion cubic feet Mansuriya gas field for 25 years. Last year, the Central Bank of Iraq said it planned to allow trade with China to be settled directly in yuan for the first time to improve its access to foreign currency. The settlement of trade in the Chinese currency instead of the US dollar will help the Iraqi central bank to “stabilise exchange rates”, it said in a statement at the time. China’s heavy dependence on Middle Eastern oil and gas has prompted substantial investments in infrastructure projects via the Belt and Road Initiative. China is looking to position itself as an alternative to the US in the region. It has previously mediated talks between Iran and Saudi Arabia. Meanwhile, with the notable exceptions of Guyana, Mozambique, Liberia and Namibia, big international energy players have continued to retreat from established hydrocarbon basins around the world, Ms Hari said. “They have been variously replaced by smaller independents and national oil companies and in some cases, by Chinese state-owned giants, who still have the mandate to secure equity in oil and gas for the country’s future needs,” she added. China’s oil demand is expected to slow this year. Crude demand growth is set to fall by 63 per cent from 2023 to 620,000 bpd this year, the IEA said in a report earlier this year. Natural gas push The latest contracts could help Iraq harness its vast natural gas resources, which are key to addressing the country’s chronic electricity shortages, especially during hot summers. Despite billions of dollars spent on infrastructure over the past few decades, many Iraqi cities and towns still experience severe power cuts and rolling blackouts. The country’s electricity demand is set to double between 2019 and 2030, with its supply shortfall expected to widen as its population grows by more than a million a year, according to the IEA. Giovanni Staunovo, a strategist at UBS, said that increasing domestic gas usage may free up more crude for exports in the long term. However, some analysts have expressed concerns about Iraq’s ability to implement the oil and gas contracts. More than 20 years since the US invasion of Iraq, the country remains mired in challenges, compounded by political divisions and foreign interference. Most recently, Iraq became a battleground between Iran-backed Shia militias and US troops stationed in the country, arising from tit-for-tat violence related to the war in Gaza and the broader conflict between Tehran and Israel. “Iraq's recent contract signings represent a pivotal moment in its energy sector evolution,” Mr Baban said. “However, challenges persist, including political complexities and regional tensions, which could impede the smooth implementation of these contracts,” he added. “As Iraq navigates its path forward, addressing these issues will be critical to realising the full potential of its oil and gas reserves in the coming decades.”

Iraq signs gas flaring deal with Honeywell

The Iraqi government and Iraq’s private sector and Honeywell have signed a number of Memoranda of Understandings (MoUs). The MoUs will strengthen Iraq’s infrastructure as the nation deals with a growing demand for energy and power. The agreements were made in April 2024 while Iraqi Prime Minister Mohammed Shia Al-Sudani was visiting the US. A statement from the US company states that Honeywell was able to look into possible strategic alliances with Iraq’s oil and gas industries through these agreements. These alliances could involve the provision of development, automation, remote control, and monitoring services in addition to the prevention of gas flaring. “Honeywell has done remarkable work in Iraq, and I look forward to what we can do with these agreements,” said Ken West, president and CEO of Honeywell Energy and Sustainability Solutions (ESS). “While there has been significant development within the energy sector locally, there is still tremendous potential for growth and cooperation, all aimed at providing a more reliable and sustainable energy sector for Iraqis throughout the country,” added West. Since the 1970s, Honeywell has operated in Iraq, and most recently, Mohamad Shaboot was named President of Honeywell Iraq. “These agreements show a clear commitment by both Honeywell and the Iraqi public and private sectors to continue the modernization and development of local industry,” said Shaboot. “The focus on the energy sector is only continuing to grow and it is incumbent upon all of us to put in place the necessary technology and rigor to help realize a better energy future for the entire region.” Honeywell provides industrial services in a number of areas, such as energy, smart buildings, and aerospace.

Controversy and caution surrounds Iraq's bid to end UN mission

Iraq's government, led by Prime Minister Mohammed Shia al-Sudani, has called for the United Nations to end its longstanding political mission in Iraq by 2025, asserting that the mission has outlived its necessity. This plea has elicited a range of responses from Iraqi politicians and observers, with some endorsing the decision while others warn of potential consequences. Raed Al-Maliki, a member of the Iraqi Parliament's Legal Committee, welcomed the government's stance, affirming on the X platform that "The presence of this mission is based on Chapter VII resolutions of the United Nations Charter and it is a form of restricting sovereignty at the international level." He agreed with the government's view that the mission's continuation may impinge on Iraq's sovereignty. However, the decision has not been universally embraced. The Al-Hal party, led by politician Jamal Al-Karbouli, urged caution, stating, "The decision needs caution and review." Al-Karbouli highlighted instances where the UNAMI allegedly displayed bias towards political interests, particularly in its interactions with successive governments. He suggested that Jeanine Hennis-Plasschaert, the UN mission's representative, had influenced its trajectory, sometimes favouring certain political factions. The Iraqi government issued a statement on Sunday regarding the termination of the United Nations mission, indicating its request to conclude the UNAMI mission by the end of 2025. Government spokesperson Bassem al-Awadi stated that this decision aligns with the government's approved program by the parliament and its efforts to regulate Iraq's relations with international bodies in light of developments since 2003. The government formally submitted its request to the UN Security Council and the Secretary-General of the United Nations in May 2023, aiming to assess UNAMI's work objectively and prepare for its definitive closure, al-Awadi added. Plasschaert, who assumed her role in January 2018, succeeding Jan Kubis, has been praised and criticised for her approach. Despite her significant role in political dialogues, she faced backlash for perceived closeness to armed faction leaders, earning her the local nickname "the auntie." Before her UN appointment, Plasschaert served as the Netherlands' Minister of Defense from 2012 to 2017, making her the first woman to hold the position. In her final briefing in February, Plasschaert emphasised the critical juncture facing Iraq and urged restraint against internal and external threats. She also highlighted the continued prevalence of corruption, stressing the need for accountability to curb embezzlement and misuse of public funds. Responding to the government's call, Muhi al-Ansari, head of the Iraqi movement Al-Bayt Al-Iraqi, criticised the UN mission's perceived role, stating to The New Arab's Arabic-language sister publication, Al-Araby Al-Jadeed that it had contributed to institutional fragility and legitimised non-state armed groups, dubbing Plasschaert as the "saviour of the regime" amid the 2019-2020 protests. On the other hand, Iraqi political researcher Ghaleb al-Daimi acknowledged Plasschaert's controversial role but stressed the ongoing need for UN representation in Iraq despite criticism from various political factions. Ending the mission necessitates a decision from the United Nations Security Council, which mandates majority approval and requires no objection from any of the five permanent member states. This authority is derived from the powers bestowed upon the Security Council by the Charter, spanning from Article 39 to Article 52. This decision-making process underscores the Security Council's role in establishing and annually extending the mission. It reinforces the council's prerogative to terminate the mission, highlighting that such a decision can only be revoked through an official mechanism.

Chinese companies win more bids to explore for oil and gas in Iraq

No US oil majors have been involved, even after Iraqi Prime Minister Mohammed Shiaa al-Sudani met representatives of US companies last month. Iraq’s oil minister said Chinese companies won five more bids to explore Iraqi oil and gas fields as the Middle Eastern country’s hydrocarbon exploration licensing round continued into its second day. Chinese companies have been the only foreign players to win bids, taking licenses covering ten oil and gas fields, while Iraqi Kurdish company KAR Group took two. The oil and gas licences for 29 projects in total are mainly aimed at ramping up output for domestic use, with more than 20 companies pre-qualifying, including European, Chinese, Arab and Iraqi groups. Iraq wanted this licensing round, the country’s sixth, in particular to increase output of natural gas, which it needs to use to fire power plants that currently rely heavily on gas imported from Iran. However, no bids were made on at least six fields with gas potential, possibly undermining those efforts. Also notably no US oil majors have been involved, even after Iraqi Prime Minister Mohammed Shiaa al-Sudani met representatives of US companies on an official visit to the United States last month. Among specific awards, China’s CNOOC Iraq won a bid to develop for oil exploration Iraq’s Block 7, that extends across the country’s central and southern provinces of Diwaniya, Babil, Najaf, Wasit and Muthanna, said oil minister Hayan Abdul Ghani. ZhenHua, Anton Oilfield Services and Sinopec won bids to develop the Abu Khaymah oilfield in Muthanna, the Dhufriya field in Wasit and the Sumer field in Muthanna, respectively, the minister said. Iraq’s oil minister added that China’s Geo-Jade won a bid to develop the Jabal Sanam field for oil exploration in Basra province. Iraq, OPEC’s second-largest oil producer behind Saudi Arabia, has been hampered in its oil sector development by contract terms viewed as unfavourable by many major oil companies, as well as recurring military conflicts and growing investor focus on environmental, social and governance criteria.

Iraq Says It Won’t Agree to More OPEC+ Oil Output Cuts

Iraqi Oil Minister Hayan Abdul Ghani said on Saturday that his country would not agree to renew oil production cuts in the forthcoming OPEC+ meeting, scheduled for early next month in Vienna. Speaking at an oil and gas licensing event in Baghdad, Abdul Ghani stated that Iraq had already made enough voluntary oil production reductions and would not agree to "any renewals" proposed by OPEC+. OPEC+, comprising the Organization of the Petroleum Exporting Countries (OPEC), Russia, and other non-OPEC producers, has been pushing for production cuts among its members to stabilize oil prices amid a weak global demand. Iraq said in March that it would extend a voluntary oil production cut, in accordance with a previous agreement with OPEC+, until the second quarter of 2024. As OPEC's second-largest oil producer, Iraq boasts over 145 billion barrels of proven oil reserves and approximately 132 trillion cubic feet of proven natural gas reserves. The country's economy is heavily dependent on crude oil exports, which constitute over 90 percent of its revenu

Iraq invests in 29 oil and gas fields in 12 provinces

Prime Minister Mohammed S. Al-Sudani sponsored the launch of the fifth supplementary and sixth licensing rounds. “These rounds include 29 projects encompassing oil and gas fields and exploratory blocks, distributed across 12 provinces in Iraq,” stated the Media Office of the Prime Minister in a statement.

Suspension of artistic and financial measures for the elections in the Kurdistan Region

Board of Commissioners: Suspension of artistic and financial measures for the elections in the Kurdistan Region "Until the complaint is resolved in the Federal Court" 🔹The Board of Commissioners of the Independent High Electoral Commission suspended the artistic, administrative and financial measures related to the Kurdistan region's parliamentary elections. The Independent High Electoral Commission has decided to suspend the technical and financial measures related to the Kurdistan parliamentary elections until the complaint is resolved before the Federal Court. According to the statement of the High Electoral Commission, the Board of Commissioners decided to: 1- Suspension of the technical and financial measures related to the Iraqi Kurdistan Parliamentary Elections (2024), until the resolution of the complaint before the Federal Supreme Court No. (126/Federal/2024). 2. Instruct the electoral administration to take the necessary measures. 3. This decision shall be published on the website of the Commission.

From challenges to collaborations: IRAQ-TURKIYE relations in focus

Iraq and Turkiye's relationship spans a spectrum of challenges and collaborations, from addressing security concerns related to the PKK to fostering robust trade ties and navigating complexities in the oil and water sectors. This report sets the stage for a closer examination of the multifaceted dynamics shaping their bilateral interactions. Turkiye's Military Operations And Iraq's Evolving Response The Turkish Armed Forces have been conducting cross-border military operations against the Kurdistan Workers' Party (PKK) since the 1980s. The PKK maintains bases in the mountainous areas of northern Iraq near the Turkish border. This proximity allows them to launch attacks into Turkiye. In contrast, the Turkish army has established several military bases at strategic points in the Matin mountain range in Iraqi Kurdistan, citing the expulsion of Kurdistan Workers' Party militants as justification. In July 2015, a two-and-a-half year-long ceasefire broke down, and the conflict between Ankara and militants of the PKK – recognized as a terrorist organization by Turkiye, the U.S., and the European Union – entered one of its deadliest chapters in nearly four decades. Since that date, the conflict has progressed through several phases. Between roughly 2015 and 2017, the violence devastated communities in some urban centers of Turkiye's majority Kurdish southeast and – at times – struck into the heart of the country's largest metropolitan centers. From 2017 onward, the fighting moved into rural areas of Turkiye's southeast. As the Turkish military pushed more militants out of Turkiye, by 2019, the conflict's concentration shifted to northern Iraq and northern Syria. In 2020, the first mission triggered a series of subsequent operations with similar names and methods of execution, each justified differently. Between June and September 2020, Ankara launched Operation Claw Eagle and Claw Tiger, characterized by airstrikes carried out by aircraft and drones targeting PKK positions in Mount Sinjar. Additionally, ground operations were conducted in Haftanin (Zakho District of Duhok) against Kurdish guerrilla forces. In April 2021, the Turkish army launched Claw-Lightning and Claw-Thunderbolt operations along the Iraq-Turkiye border near Metina, Zap, and Avashin-Basyan. In April 2022, Ankara commenced Operation Claw-Lock in northern Iraq, establishing several bases in Duhok Governorate. Iraq views Turkish airstrikes and bases as a violation of its sovereignty and territorial integrity. These operations commonly cause civilian casualties and damage infrastructure alongside the killing of PKK members. The Iraqi government also worries that Turkish military presence in northern Iraq could destabilize the Region and empower Kurdish separatists within Iraq. The PKK conflict, spanning about four decades, has been a persistent challenge, with Turkiye expressing disappointment in the Iraqi government's historical "reluctance" to acknowledge and ban the PKK as a terrorist organization. However, recent developments have signaled a shift in Iraq's stance. Last March, Turkiye proposed the establishment of a "joint operation center" with Iraq to combat the Kurdistan Workers' Party (PKK), a move that has received a positive response from Baghdad. Previously, a high-level Turkish delegation, including Foreign Minister Hakan Fidan, Defense Minister Yasar Guler, and National Intelligence Organization (MIT) head Ibrahim Kalin, visited Baghdad for a top security meeting with Iraqi counterparts. This meeting marked the second round of discussions, with the first round held in Ankara in December. During a press conference in Ankara, Brigadier General Zeki Akturk, the Turkish defense ministry's media, and public relations advisor stated that Iraq and Turkiye are ready to sign a strategic framework document. This document aims to establish a joint operations center as part of Ankara's efforts to combat terrorism. "Both countries are positively inclined towards our proposals for the Joint Operations Center and other cooperation efforts in combating terrorism," said Akturk. He also noted that Iraq recognizes the PKK as a threat. According to a Turkish defense ministry official, the proposal aims to enhance cooperation in addressing the PKK's activities along the Iraq-Turkiye border. Following the high-level talks, Iraq announced the designation of the PKK as a "banned organization." Moreover, the Kurdistan Region is always confirmed to turn the Region into a source of conflict with neighboring countries. In a TV interview last February, the President of Kurdistan Region, Nechirvan Barzani, was asked if Turkiye coordinates with Erbil when launching strikes against PKK in the Region; Barzani explained, "The (Kurdistan) Workers' Party is a severe headache for the Kurdistan Region and Iraq as well. They do not value the legitimacy of the Kurdistan Region's institutions and threaten Turkiye from our territories. While we completely reject the principle of turning the lands of the Kurdistan Region into a source of threat to our neighbors, whether this neighbor is Turkiye or Iran." He rejected that PKK, as opponents of Tehran and Ankara, "make the Kurdistan Region a safe area to create problems for these countries. It is regrettable that the PKK plays a very negative role in this context and uses the mountainous areas of the Kurdistan Region and tries to create problems for Turkiye. This is absolutely unacceptable from our side." Iraq-Turkiye's Growing Economic Partnership Iraq and Turkiye have a long history of trade relations; Turkiye's most important exports to Iraq include chemicals and products, the oilseed sector and its derivatives, grains and legumes, furniture, paper and forest products, the construction sector, and medicines. On the other hand, Iraq's most important exports to Turkiye are mainly oil. On Saturday, the Turkish Ministry of Trade revealed that Turkish exports to Iraq would soon increase to $15 billion and $20 billion by 2030. Turkish Minister of Trade Omer Polat told Anadolu Agency that "Iraq has always been one of the most important countries for Turkiye in terms of trade and economic relations," noting that "Iraq's share of Turkish exports over the past ten years exceeded 5% of the country's total exports." Polat clarified that "Turkish exports to Iraq encompassed most sectors, with the trade volume between the two countries reaching $24.2 billion in 2022 and $19.9 billion last year." "Our exports to Iraq decreased by 7.2% compared to the previous year, reaching $12.8 billion, while our imports from Iraq decreased by 31.1% to approximately $7.2 billion during the same period. Our foreign trade surplus was $5.6 billion last year." Polat emphasized that "exports increased by 24.5% during the first three months of 2024 compared to the same period last year, reaching $3.4 billion, while imports decreased by 46.2% to $835 million." The Turkish Minister of Trade concluded by indicating that "Turkish exports to Iraq are poised to reach $15 billion soon and $20 billion by 2030, with the completion of the Development Road project." Oil Diplomacy: Tensions And Renewed Efforts In Iraq-Turkiye Energy Relations The energy dynamics between Iraq and Turkiye have played a pivotal role in their diplomatic ties, given Turkiye's energy consumption and reliance on imports, primarily from hydrocarbons, due to limited domestic resources. Iraq, particularly the Kurdistan Region of Iraq (KRI), has emerged as a crucial partner for Turkiye, particularly in oil and gas reserves. Over the years, Turkiye has become a key strategic ally for the KRI, facilitating the export of approximately 500 thousand barrels per day (mb/d) of oil through the Ceyhan port. However, tensions escalated in March 2022 when Turkiye halted oil exports amounting to 450,000 bpd from Kurdistan following a compensation order by the International Chamber of Commerce related to "unauthorized" oil exports by the KRG between 2014 and 2018. The crux of the dispute revolves around accusations that Turkiye breached a 50-year-old pipeline transit agreement by allowing oil exports from KRG-controlled areas without Iraq's consent. Baghdad contends that Ankara and the Turkish state energy company BOTAS violated the terms of a 1973 Iraq-Turkiye pipeline agreement by handling oil from Kurdistan without official approval. Iraq asserts that only the state-owned marketer SOMO has the authority to manage crude exports via Ceyhan. While most of Iraq's crude exports pass through southern ports, the northern route via Turkiye still contributes around 0.5% of the global oil supply. The halt in exports contributed to the oil barrel to reach 80$ at that time. During a visit to Erbil in November 2023, Iraqi oil minister Hayan Abdel-Ghani expressed optimism about reaching an agreement with the KRG and foreign oil companies to resume oil production from Kurdish oilfields. Despite Turkiye's prior announcement that the pipeline was ready to operate, Iraq maintained that it had yet to receive official notification and highlighted unresolved financial and technical issues. However, recent discussions between the Iraqi PM Mohammed Shia Al-Sudani and U.S. President Joe Biden emphasized the importance of ensuring Iraqi oil reaches international markets, signaling a renewed effort to reopen the pipeline between Iraq and Turkiye. In response, the Association of the Petroleum Industry of Kurdistan (APIKUR) expressed readiness to engage in discussions with Iraqi and KRG officials to resume oil exports, stressing the need for guarantees regarding financial obligations per existing agreements. Water Crisis: Turkiye's Dams And Iraq's Droughts The water problem between Iraq and Turkiye primarily revolves around the flow of the Tigris and Euphrates rivers, which originate in Turkiye and flow through Syria and Iraq. The construction of dams and large irrigation systems by Turkiye has led to a massive reduction in water flow into Iraq by 30-40%, causing droughts and water shortages. In addition, Turkiye's Southeastern Anatolia Project (GAP) and the Ilısu Dam project are particularly contentious. They have resulted in a 40% cut in water flows into Syria and Iraq, impacting agriculture, energy production, and the overall water supply in these countries. This reduction in water flow has been a major source of tension between the two countries, with Turkiye's projects leading to droughts in Iraq and exacerbating the water shortage crisis in the Region.