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The newly resuscitated Iraq National Oil Company (INOC) has been authorised by the government in Baghdad to directly negotiate with U.S. oil giant, Chevron, for it to develop the long-delayed Nasiriyah oil field in the southern DhiQar province, according to several domestic news sources.

The idea of developing the 4.36 billion-barrel Nasiriyah oilfield has been mooted by a rapid succession of governments in Iraq since it was discovered by INOC in 1975. The original plan to develop the field on a standalone basis was shelved in the lead-up to the Iran-Iraq war that began in 1980 and lasted until 1988. The field eventually came on-stream in 2009 and was listed on the 2009-2010 fast-track development plan, which aimed to raise its output to at least 50,000 bpd in the first phase.

In the first half of 2009, Chevron was one of four international oil companies (IOCs), along with Italys ENI, Japans Nippon Oil, and Spains Repsol, to be invited to submit bids to develop the field on an engineering procurement construction (EPC) contract basis. The Japanese consortium led by Nippon Oil, and comprising Inpex, and JGC Corporation, then looked set to win the contract before negotiations broke down again.

In 2014, a serious push was made to resuscitate the development of the Nasiriyah field within the broader scope of the Nasiriyah Integrated Project (NIP) that also included the development of adjunct lesser oil sites to the main Nassiriyah site and the construction of a 300,000 barrels per day (bpd) refinery. Bids for this wider project were encouraged by the government-ordered changes to the original Iraq technical service contract (TSC) that were aimed at addressing the concern of many IOCs that saw the contract model as falling short of the production sharing contracts model that they preferred.

Unlike the previous contracts, the new TSC variant offered investors a share in project revenues, but only when production began, and the Oil Ministry would pay recovery costs from the date of commencement of work. This differed from the previous contract where the costs were only paid when the contractor raised production by 10 per cent. This said, investors would still have to pay 35 per cent taxes on the profit they made from the Nassiriya project, the same amount as in previous deals.

At that point in 2014, the international engineering and construction firm Foster Wheeler had already completed a front end engineering and design study for the refinery, and 12 potential bidders were on the list. These comprised: Indias Reliance Industries, Oil and Natural Gas Corp, and Essar Oil, Russias Rosneft, Lukoil, and Zarubezhneft, Frances Total, and Maurel & Prom, Chinas CNPC, the U.S.s Brown Energy, a Japanese joint bidding team from JGC and Tonen General, and South Koreas GS Engineering & Construction.

Given longstanding IOC concerns about legal, accounting, and financial transparency in Iraq, this 2014 initiative to develop the Nassiriyah oil field foundered. As summarised by the independent international non-governmental organisation, Transparency International (TI), in its Corruption Perceptions Index, Iraq demonstrates: Massive embezzlement,procurement scams, money laundering, oil smugglingand widespread bureaucratic bribery that have led thecountry to the bottom of international corruptionrankings, fuelled political violence and hamperedeffective state building and service delivery.

In 2017, China relaxed its directive of the previous two years to all state-owned hydrocarbons companies to cut budgets. From the Iraqi side, this coincided with a fresh impetus for expediting as much production from the south of the country ahead of the chaos in oil supplies from the north that was likely to result (and did) from Kurdistans independence referendum to be held in September.

These factors then led to Chinas Sinopec and PetroChina proposing a deal that would see the NIP being rolled out as part of the broader Integrated South Project (ISP). The ISP (later rebranded as the South Iraq Integrated Project) aimed to boost output across Iraqs southern oilfields, and also to build out related infrastructure, including pipelines, transport routes, and the construction of the Common Seawater Supply Project (CSSP).

The Chinese said that they would spend US$9 billion on the [NIP-related] refinery and the first phase of developing Nassiryah but as, under the terms of Iraqi oil contracts, the Iraqis would have to pay back this cost to the Chinese from the value of oil recovered, a source who works closely with Iraqs Oil Ministry told OilPrice.com. The initial reaction from the Oil Ministry was to decline the offer, and to say that the development should only cost around US$4 billion, which the Chinese in turn flatly turned down.

The Chinese had other demands that grated on Iraq at that time as well. China also wanted its firms to receive their costs back in a much shorter timeframe than most other similar projects, said the source. This meant that they were effectively asking for a per barrel remuneration fee at a 15 per cent premium to the highest maximum fee being paid to any company in Iraq for a regular crude oil producing field, which was US$6 per barrel to PetroChina for al-Ahdab, he added. This would mean that the Chinese would get around US$6.90 per barrel, more than [Angolas] Sonangol for its heavy oil extraction at Najmah [US$6 per barrel] and Qairayah [US$5 per barrel] and would dwarf the US$1.49 per barrel that [Malaysias] Petronas was getting for the same type of field of Gharraf, he told OilPrice.com. China also demanded that it was given [Iraq] dinar-denominated government-backed bonds for the entire amount [US$9 billion] that could be cashed in if the development did not start to generate large amounts of oil quickly, he underlined.

Given the negative history of dealing with China over the Nassiriyah project and the fact that Russia is occupied elsewhere in the country and the region, the U.S. might be in an unusually positive position to take a significant role in either the Nassiryah field development alone or in the broader NIP. This has been bolstered by the apparent willingness of Iraqs de facto leader - radical Shiite cleric Moqtada al-Sadr to engage with U.S. ally, Saudi Arabia, and by the shift in tone from one key player in Iraqs influential al-Hakim family.

Whether this shift in attitude towards doing substantial and enduring business with the U.S. across its oil, gas, and petrochemicals sectors is genuine, or whether it is just the usual games-playing by Baghdad to keep the money flowing from Washington, remains to be seen but the slew of deals signaled recently appear propitious at this stage.

By Simon Watkins for Oilprice.com

More Top Reads From Oilprice.com:

Link:
Chevron's Latest Oil Deal With Iraq Is One To Watch - OilPrice.com

Greek Foreign Affairs Minister Nikos Dendias met with his counterparts of Egypt, of Jordan and of Iraq, and also with Arab League Secretary-General Ahmed Aboul Gheit, on the first of his three-day visit to Bahrain on Saturday.

At capital city Manama, Dendias will be attending the annual forum Manama Dialogue.

On Saturday, the Greek minister is also expected to meet with Israeli National Security Adviser Eyal Hulata, on the sidelines of the forum.

On Sunday, he will be meeting with Prime Minister of Iraqi Kurdistan Masrour Barzani and also with Jordanian counterpart Ayman Safadi. He will also attend the discussion Conflict Termination in the Wider Region at Manama Dialogue.

On Monday, Dendias will meet with his counterpart of Bahrain Abdullatif bin Rashid Alzayani, where talks are expected to focus on bilateral relations, developments in the Eastern Mediterranean and the Middle East, in the Gulf and in Libya, and also in Greeces cooperation with the Gulf Cooperation Council, it was said in a ministry statement.

Dendias will then be received by Prime Minister of Bahrain and heir to the throne Prince Salman bin Hamad Al Khalifa.

[AMNA]

Read more:
Dendias meets with counterparts from Egypt, Jordan, Iraq in Bahrain - http://www.ekathimerini.com

Why do the Zionist regime and the Westerners defend the seemingly pro-Kurdish anti-revolutionary groups? asked Irans interior minister during a visit to the Kurdish region of Iran, according to Tasnim News.

Irans new Interior Minister Ahmad Vahidi is wanted by Interpol for murdering 85 people in the 1994 bombing of the AMIA Jewish community center in Buenos Aires. However, now the minister wants to devote his discussion to the support he will provide the Kurdish region in Iran. He claimed that the Kurdistan region needs prosperity and security and that Kurds had rejected attempts by foreign regimes to undermine Irans role in its northwest, where Kurds live.

He stated that the Kurds, along with the people all over the country, have punched the counter-revolution in the mouth with a strong fist in the face of the conspiracies and extravagances of the enemies, the report said.

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The minister of interior pointed out: The people of Kurdistan are proud and resilient and it is right to be a model and to learn many lessons from their honor, dignity, resistance and stability, he said.

Undoubtedly, Kurdistan and the universities of this province can be an important center for the whole region and the upbringing of Kurds and Kurdish nations abroad, if the doors of our universities are open to them because we have very good relations with the Kurdish nations and the Kurdish region of Iraq.

He praised the role of Kurds in Iran and recalled the brutalities of the Saddam Hussein regime.

The enemies have made many attempts to divide us and the Kurds of Iraq and Iran, which fortunately were not achieved by the Kurdish people and will never be able to do so, he said.

Unlike other countries in the region that generally have suppressed Kurds and denied their existence, Irans regime has a more nuanced view of them.

The Kurdish nation has always been united and their civilization, culture and bravery in defending the system throughout history can be good lessons for others, the minister said.

He says the new governor will address the concerns of the people.

Emphasizing that the new governor should do his best to solve the peoples problems, the interior minister added: While identifying the problems, priorities should be determined and steps should be taken in this direction as if we would also support them.

He praised the region for its human capital and culture. He said deprivation would be reduced.

He considered the completion of construction projects, the highway corridor in the west of the country necessary and added: The issue of drinking water in Sanandaj is very important and should be resolved as soon as possible, according to the report.

A strong Kurdistan and Iran will be realized when all people come to the square, he said.

Link:
Iran wants to invest in Kurdish region to counter 'Zionists' - analysis - The Jerusalem Post

During an informal press gaggle today, Pentagon Press Secretary John F. Kirby answered questions about a congressional visit to Taiwan, Afghan refugees and Iranian actions in Iraq.

China has objected to a visit to Taiwan by a U.S. congressional delegation. Kirby noted that congressional visits to Taiwan are relatively common and in keeping with U.S. obligations under the Taiwan Relations Act. The members of Congress are traveling on a U.S. military jet, as is the custom for congressional delegations.

Kirby confirmed that a group of 191 Afghans who escaped from Afghanistan to Tajikistan including some Afghan air force pilots who flew to the country as Kabul fell may be evacuated from that nation soon. "Our embassy there is working to expedite their departure,"Kirby said. "We expect that they'll be able to depart Tajikistan soon, but we are not in control of the timeline."

Kirby said DOD "presumes"that attacks in and around Iraq were launched by Iranian-backed militias. There have been a number of attacks with the latest being an attempt to assassinate Iraqi Prime Minister Mustafa al-Kadhimi on Sunday. Drones attacked the prime ministers residence in Baghdad.

"These attacks are being perpetrated by militia groups that are backed by Iran, and [they] have access to resources and to lethal tools to conduct these attacks,"Kirby said. "I can't speak with great specificity as to the timing of these attacks and why they're happening in certain times, as opposed to others."

"All I can say is, we're focused on the threat,"he continued. "It's not just a threat to us, but to our Iraqi partners as the attack on the prime minister clearly demonstrated. And we take those seriously."

Kirby would not say what group launched the attack. He noted these groups have launched similar attacks using large and small unmanned aerial systems. "That is a common tactic of theirs,"he said. "And so we are certainly working under the presumption that that's the case here, but I'm not going to get into specific attribution at this time."

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Kirby Updates Media on Visit to Taiwan, Iranian-Backed Groups in Iraq - Department of Defense

National security adviser Robert O'Brien arrives to speak to reporters outside the White House on Tuesday. O'Brien announced that President Trump has ordered 2500 U.S. troops to be withdrawn from Afghanistan and Iraq by Jan. 15. Drew Angerer/Getty Images hide caption

National security adviser Robert O'Brien arrives to speak to reporters outside the White House on Tuesday. O'Brien announced that President Trump has ordered 2500 U.S. troops to be withdrawn from Afghanistan and Iraq by Jan. 15.

The White House announced Tuesday that it will pull thousands of troops out of Iraq and Afghanistan by Jan. 15. A force of 2,500 service members will remain in both countries, but the Trump administration aims to have all remaining troops out of Iraq and Afghanistan by Spring 2021.

"By May, it is President Trump's hope that they will all come home safely and in their entirety," national security adviser Robert O'Brien said. "I want to reiterate that this policy is not new. This has been the president's policy since he took office."

Nearly 3,000 lives were lost in the Sept. 11 terrorist attacks and an additional 7,000 American service members have been killed in the nearly 20 years of armed conflict since. Trump had promised during his 2016 campaign that he would end the wars in Iraq and Afghanistan.

But, the drawdown worries some military leaders. Peace talks with the Taliban appear to be stalled and attacks are on the rise in Afghanistan. Senate Majority Leader Mitch McConnell is also concerned about reducing the number of boots on the ground in such a tumultuous time.

"I think it is extremely important here in the next couple of months not to have any earthshaking changes with regard to defense and foreign policy," McConnell said. "I think a precipitous drawdown in either Afghanistan or Iraq would be a mistake."

Troop levels had surged to a high of more than 100,000 until Osama Bin Laden was killed in 2011. Shortly after, President Barack Obama began withdrawing troops from the Middle East and numbers have continued to decline in years since.

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Trump Administration Wants All U.S. Troops Out Of Iraq And ...