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Increasing Iraqi oil production... Ambitious numbers clash with "corruption and failure"
Reports & Analytics Iraqi oil Increasing oil production
2022-08-18 16:20
Shafaq News/ An economic analysis concluded that two obstacles are "corruption and failure" to the increase of Iraqi oil to millions, which the country's oil officials are seeking.
An economic report published on "Yahoo" and translated by Shafak News indicated that
"Iraq plans to increase its oil production to achieve an interim goal of between 5 to 8 million barrels per day over time."
In this context, he recalled recent statements by the
First Vice President of the Iraqi National Oil Company, Hamid Younis, and the
Director General of the Iraqi Oil Exploration Company, Ali Jassem,
about this planned increase and the significant activity expected in the next phase in the exploration sector, including in the Western Desert and Nineveh Governorate..
The report considered that
"given the current delicate balance between supply and demand in the global oil pricing equations, these large supplies may lead to mitigating the economic damage that has affected many countries due to the exorbitant oil and gas prices."
However, the report, after questioning the extent of the realism of these statements about high oil prices, added that
"these statements are "completely realistic", given that Iraq possesses about 145 billion barrels of proven crude oil reserves (about 18% of the total Middle East, and about 9%). of global reserves, and it has the fifth largest reserves in the world).
Despite this, the report quoted data from the International Energy Agency from 2012 on Iraq, which considers that the volume of Iraqi recoverable oil resources is subject to a great degree of uncertainty,” noting that
“the number of 145 billion barrels is sourced from the United States Geological Survey (USGS) from year 2000. He explained that
"through the use of these data, the International Energy Agency's 2012 analysis concluded that the volume of recoverable crude oil and natural gas liquids resources in Iraq is estimated at 232 billion barrels.
However, at the end of 2011, only 35 billion barrels were produced. out of this figure of 232 billion barrels. And the report continued that
"also in 2012, and based on the figures of the US Geological Survey, Iraq produced only 15% of its recoverable resources, compared to 23% at the level of the Middle East as a whole, according to data from the International Energy Agency." The report explained his idea, saying that
"it is important to distinguish that
having huge levels of reserves and recoverable resources is one thing, but
drilling and exporting them is another matter entirely." The report pointed out that
"during the period in which the International Energy Agency report was issued in 2012 until now, crude oil production in Iraq rose from more than 3 million barrels per day to just above 4 million barrels per day."
Although this percentage is exciting and equivalent to 25% as an increase, the report considered that
"in terms of its absolute value, it constitutes a weak return on the oil revenues owned by Iraq,
especially if it takes into account the ease of recovering its oil, as it is clear that Iraq has the lowest extraction cost in The world is worth between 1-2 dollars per barrel, as oil from Saudi Arabia and Iran.” The report mentioned that
"Iraq launched in 2013 the "Integrated National Energy Strategy", which lays out three scenarios about oil production, the
best of which is to increase production capacity to 13 million barrels per day (at that stage by the year 2017), with a peak until the year 2023., while the
medium scenario was set to reach 9 million barrels per day (at that stage by the year 2020), while the
worst scenario was to reach the production of 6 million barrels per day (at that stage by 2020)." However, the report asked,
"Why was Iraq not able to achieve this despite the fact that the basis on which these expectations were based is very solid."
The report identified two main reasons, the
first is the rampant corruption that afflicted the oil sector, especially since the fall of Saddam Hussein in 2003, and the
second reason, which is partly related to the first, is the failure to build the "Common Sea Water Supply Project (CSSP)".
The report pointed to the "culture of corruption in Iraq", recalling the data of the independent Transparency International on the "Corruption Perceptions Index", in which Iraq appears among the worst in the world out of 180 countries due to the extent and scope of corruption.
The report quotes Transparency International, speaking in this context about
“massive embezzlement,
fraud in the field of procurement,
money laundering,
oil smuggling and
widespread bureaucratic bribery that led the country to the lowest international corruption ratings, provoked political violence and impeded building an effective state and providing services.”
As for the "Joint Sea Water Supply Project (CSSP)", the report considered that the extent of rampant corruption may be a main reason for not moving forward with its implementation, but it indicated that
if Iraq manages to cordon off the project as much as possible to keep the corrupt elements away from it, It may be able to start achieving the envisaged huge increases in oil production, noting that
the project includes plans to withdraw water from the Gulf and then treat it before transporting it through pipelines to the oil fields to be used to strengthen pressure and increase oil absorption,
which is estimated to cost about 10 billion dollars,
and aims to secure About 6 million barrels per day of water flow to at least five oil fields in the southern Basra region and another field in the Maysan region.
Increasing Iraqi oil production... Ambitious numbers clash with "corruption and failure"
Reports & Analytics Iraqi oil Increasing oil production
2022-08-18 16:20
Shafaq News/ An economic analysis concluded that two obstacles are "corruption and failure" to the increase of Iraqi oil to millions, which the country's oil officials are seeking.
An economic report published on "Yahoo" and translated by Shafak News indicated that
"Iraq plans to increase its oil production to achieve an interim goal of between 5 to 8 million barrels per day over time."
In this context, he recalled recent statements by the
First Vice President of the Iraqi National Oil Company, Hamid Younis, and the
Director General of the Iraqi Oil Exploration Company, Ali Jassem,
about this planned increase and the significant activity expected in the next phase in the exploration sector, including in the Western Desert and Nineveh Governorate..
The report considered that
"given the current delicate balance between supply and demand in the global oil pricing equations, these large supplies may lead to mitigating the economic damage that has affected many countries due to the exorbitant oil and gas prices."
However, the report, after questioning the extent of the realism of these statements about high oil prices, added that
"these statements are "completely realistic", given that Iraq possesses about 145 billion barrels of proven crude oil reserves (about 18% of the total Middle East, and about 9%). of global reserves, and it has the fifth largest reserves in the world).
Despite this, the report quoted data from the International Energy Agency from 2012 on Iraq, which considers that the volume of Iraqi recoverable oil resources is subject to a great degree of uncertainty,” noting that
“the number of 145 billion barrels is sourced from the United States Geological Survey (USGS) from year 2000. He explained that
"through the use of these data, the International Energy Agency's 2012 analysis concluded that the volume of recoverable crude oil and natural gas liquids resources in Iraq is estimated at 232 billion barrels.
However, at the end of 2011, only 35 billion barrels were produced. out of this figure of 232 billion barrels. And the report continued that
"also in 2012, and based on the figures of the US Geological Survey, Iraq produced only 15% of its recoverable resources, compared to 23% at the level of the Middle East as a whole, according to data from the International Energy Agency." The report explained his idea, saying that
"it is important to distinguish that
having huge levels of reserves and recoverable resources is one thing, but
drilling and exporting them is another matter entirely." The report pointed out that
"during the period in which the International Energy Agency report was issued in 2012 until now, crude oil production in Iraq rose from more than 3 million barrels per day to just above 4 million barrels per day."
Although this percentage is exciting and equivalent to 25% as an increase, the report considered that
"in terms of its absolute value, it constitutes a weak return on the oil revenues owned by Iraq,
especially if it takes into account the ease of recovering its oil, as it is clear that Iraq has the lowest extraction cost in The world is worth between 1-2 dollars per barrel, as oil from Saudi Arabia and Iran.” The report mentioned that
"Iraq launched in 2013 the "Integrated National Energy Strategy", which lays out three scenarios about oil production, the
best of which is to increase production capacity to 13 million barrels per day (at that stage by the year 2017), with a peak until the year 2023., while the
medium scenario was set to reach 9 million barrels per day (at that stage by the year 2020), while the
worst scenario was to reach the production of 6 million barrels per day (at that stage by 2020)." However, the report asked,
"Why was Iraq not able to achieve this despite the fact that the basis on which these expectations were based is very solid."
The report identified two main reasons, the
first is the rampant corruption that afflicted the oil sector, especially since the fall of Saddam Hussein in 2003, and the
second reason, which is partly related to the first, is the failure to build the "Common Sea Water Supply Project (CSSP)".
The report pointed to the "culture of corruption in Iraq", recalling the data of the independent Transparency International on the "Corruption Perceptions Index", in which Iraq appears among the worst in the world out of 180 countries due to the extent and scope of corruption.
The report quotes Transparency International, speaking in this context about
“massive embezzlement,
fraud in the field of procurement,
money laundering,
oil smuggling and
widespread bureaucratic bribery that led the country to the lowest international corruption ratings, provoked political violence and impeded building an effective state and providing services.”
As for the "Joint Sea Water Supply Project (CSSP)", the report considered that the extent of rampant corruption may be a main reason for not moving forward with its implementation, but it indicated that
if Iraq manages to cordon off the project as much as possible to keep the corrupt elements away from it, It may be able to start achieving the envisaged huge increases in oil production, noting that
the project includes plans to withdraw water from the Gulf and then treat it before transporting it through pipelines to the oil fields to be used to strengthen pressure and increase oil absorption,
which is estimated to cost about 10 billion dollars,
and aims to secure About 6 million barrels per day of water flow to at least five oil fields in the southern Basra region and another field in the Maysan region.
