91天堂原創

It鈥檚 a bold claim to make: that you are now the world鈥檚 second largest holder of conventional oil reserves.

But it鈥檚 one that Iraq made late last year when it announced that it had increased the size of its proven oil reserves to 143.1 billion barrels of oil 鈥� a figure that pushes the war-torn nation past Iran to become the world鈥檚 second largest holder of conventional oil reserves.

If Baghdad鈥檚 projections are to be believed, Iraq could match Saudi Arabia鈥檚 daily crude output of 10 million to 12 million barrels within the next seven years, up from just 2.5 million today. What鈥檚 more, following the successful tender for new oil exploration work in December, the country鈥檚 oil minister, Hussain al-Shahristani, made it clear that Iraq will ramp up production regardless of any restraints agreed upon by OPEC.

Yet unlike the other oil producing giants, Iraq faces an uphill battle to overcome many challenges if it is to stand alongside Saudi and Iran. The country is still plagued by its war-torn backdrop and all the issues that come with that: a wealth of security problems, an under-developed infrastructure of limited capacity, a poor regulatory framework, limited availability of trained personnel and ongoing political instability.

This, however, hasn鈥檛 been enough to deter international oil companies (IOCs) such as BP, Shell and the National China Petroleum Company, major players who have been keen to assert their presence in any of the 16 mammoth fields that Iraq opened up to international oil companies in 2009. 

According to Gavin Jones, founding partner of Upper Quartile, a business specialising in post conflict economic reconstruction, Iraq has little option but to open the country up to foreign investment. 鈥淏y enlisting the help of IOCs, they can provide the necessary expertise, technology and training that Iraq鈥檚 oil sector so desperately needs.鈥�

But, Jones admits, it isn鈥檛 going to be easy. 鈥淲hat you鈥檝e got in Iraq is basically 30 years worth of sanctions followed by six years of war. And in any environment like that it鈥檚 going to be difficult, especially when you鈥檝e got a huge array of very big, very sophisticated, very slick international companies piling over the parapet, trying to work with a government that has been isolated for 30 years.鈥�    

Iraq鈥檚 ports, for example, have started to buckle under the demand of the arriving oil majors, their service companies and the vast amounts of equipment they鈥檙e bringing with them. 鈥淭he cranes aren鈥檛 big enough, the gate out of the port isn鈥檛 big enough to take the volume of lorries, there鈥檚 nowhere to leave the stuff when you get it outside the port, and the free zone on the other side has been talked about for years, but there鈥檚 just no infrastructure.鈥�

On the export side, there鈥檚 also the issue of pipelines. Iraq鈥檚 ageing pipeline network will need major upgrades, particularly the southern export pipelines, which send 80% of Iraq鈥檚 total oil exports to the global market. Experts have said that these pipelines can handle no more than 1.6 million bpd without risk of rupturing. 鈥淭he pipelines need to be refurbished to a level where they can transport the anticipated short-term increase, and that鈥檚 about 10 to 15%. And there certainly needs to be a metering system put in place,鈥� says Jones.

Security is another pressing issue for companies keen to address a presence in certain areas of Iraq. One solution to this is the 鈥榲illage of business鈥� that an Iraqi firm is planning to build next to Baghdad airport. The mini city will provide a secure environment in which business people can live and work in a safe environment. The US$ 250 million complex is due for completion in three to five years and will be home to apartments, hotels, offices, restaurants, cafes, shops and parks.

They aren鈥檛, says Jones, insurmountable challenges. 鈥淚OCs will overcome them, because they鈥檝e done it before in Nigeria, in Pakistan, they鈥檝e done it everywhere else, and they鈥檒l complain about it and they鈥檒l try and leverage stuff out and the contracts will be changed and adapted and manipulated. But the pipelines are almost there. The port is going to be a shambles for a number of years to come, but people will manage to get stuff through. Not at the right times, but it will sort of work鈥︹��

It鈥檚 an issue that will no doubt be on the agenda at the , which takes place at Raffles, Dubai from 12-14 May. This closed-door summit, hosted by GDS International, features some of the leading voices in MENA鈥檚 oil and gas sector, including Faisal Al Thani, Acting Manager Director Qatar of Maersk Oil; Rasha El Waraky, CIO of BP, John Roper, Head of Middle East and GM of E.ON; Otto Garringer, GM of OMV Iraq and Wadda M. Ali Shareef, Director General of Iraq鈥檚 Ministry of Oil. 

Along with information security, other key topics for discussion include Iraq鈥檚 transformation, compliance in the oil and gas sector, cutting edge communications and optimum exploration techniques.

is an exclusive C-level event reserved for 100 participants that includes expert workshops, facilitated roundtables, peer-to-peer networks and coordinated meetings.

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