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Is it possible for Iraq to lead the Arab world economically
On: Tue 03/01/2012 7:12
Translation / range
discussed President Obama and Prime Minister Nuri al-Maliki, a lot of important issues in Washington last Cansahab U.S. forces and the fragility of democracy in Iraq and the threat of Iran's presence on the borders of Iraq and elsewhere. But the paragraph that was at the bottom of the agenda may be the most important factors in the future of Iraq, namely oil.
Iraq has the fourth largest oil reserves on the planet. This treasure to make Iraq one day more advanced countries of the region in terms of the economy. If Iraq was able to re-energize its oil industry, he can - with the nascent democracy - that becomes more developed countries in the Arab world.
Iraq hopes to increase its oil production from 2.7 million barrels per day currently to 13.5 million by the year 2018. The foreign experts that half this rate is considered a great accomplishment. In any case, the large increase in production will need to invest more than foreign companies that have the expertise and capital, which defeats Iraq through decades of war and unrest. However, this enthusiasm has waned due to delays routine and jamming the legal and the poor condition of pipelines and storage facilities and export terminals and the like.
red tape faced by companies in Iraq - when submitting visa applications to its users or the attempt to import the equipment or to claim entitlement - seems to reflect the feelings are rooted in the past . It has been the nationalization of the oil industry in 1972, and still echo the idea of expelling Iraq from foreign companies hesitate even within Maliki's coalition government. The time has come for decision, and the Iraqi leadership, one choice: either to create an environment suitable for foreign investment, administrative, or accept the slow growth rate of oil production.
international companies operating in Iraq, worried, and Iraqi officials to find a solution to it. Has promised the 2005 Constitution the law of oil and gas that settles the dispute over who approved the deals, but with that there is not yet such a law because the central government and the Kurdistan Regional Government did not agree on the texts.
last August, sent the Maliki government a draft law allows the Board of a federal the ratification of the agreements and technical services contract awarded by the central government. This law are paid to companies for the costs plus taxi for every barrel of oil is produced. But the Kurds - in their contracts with 43 companies - signed a production sharing agreements where the company is responsible for costs, but you get a percentage of the oil extracted. Contractors prefer these texts in which high risk but bring fruit large, as they are interested in repositories northern oil.
in the absence of a law governing it has considered the Maliki government contracts Kurds illegal and prevent companies that have signed contracts to participate in oil supplies in the rest of Iraq. Adding to the confusion, that the Baghdad government has denied these contractors on the export of oil that they produce in the areas of Kurdistan, which select their sales to the domestic market. For these reasons, attracted the northern oil fields companies of the second degree, such as oil company Marathon Corporation Hess.
after he angered the Kurdish authorities in this draft, the central government agreed to new negotiations, but Exxon Mobil shook things in T 1 when it became the first major oil company signs contracts with the Kurds - six decades of oil exploration -, did so at the same time when the business with the central government. In response, the company put the Baghdad government in the black list and threatened to cancel 60% of its share in developing the West Qurna field, which produces a giant 350 thousand barrels per day. This act by the company not only challenged the government in Baghdad but also, and the United States government has warned that companies sign contracts with the Kurds, the absence of legal framework.
However, it can be a positive catalyst Exxon maneuver if the Maliki government has taken the right decisions. Vaavad company's field West Qurna 1 or force it to choose between the Kurds or the central government, it can scare the other partners. Better to Baghdad to support oil and gas law, which adopts the production sharing contracts for the fields north and technical services agreements for the southern fields.
Many officials in Baghdad are worried that the waiver of this issue may fuel the desire of Kurds in more independence. Whenever the solution faster fastest Iraq to get the help they need to speed up oil production, increase in production will provide the money that Iraq needs to renew the structure of the oil infrastructure, which in turn will allow greater production. Pipe Almnkhurp need to replace, and the system of collecting water, which facilitates the flow of oil from the Persian Gulf oil fields need to complete, and must build storage facilities new and export terminals that replace the destroyed since the war, Iran - Iraq.
estimated the Iraqis that the investment required in these systems has $ 50 billion for the purpose of increasing production to 6 million barrels per day. This money will be difficult to obtain if the Maliki government continues to stand in the way of foreign investment.
■ for / New York Times
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