Jordan, Iraq preparing to tender $18b oil pipeline

The Jordan Times

Work to construct a $18 billion oil pipeline from Iraq’s Basra to Jordan’s port city of Aqaba may start soon, as officials from both coutries are meeting with international firms interested in the mega-project, an official said Saturday.

Jordan and Iraq are speeding up their measures and efforts to construct the pipeline, a senior official at the Aqaba Special Economic Zone Authority (ASEZA) told The Jordan Times.

The official, who preferred to remain unnamed,  said that Jordanian and Iraqi officials held meetings last week in Aqaba with several international companies that showed interest in carrying out the scheme, adding that work on the project is set to begin soon.

Once completed –– the pipeline is projected to export 2.25 million barrels of oil per day through the Kingdom. It would generate between $2 billion and $3 billion a year in revenues for the Kingdom, according to estimates of Iraqi and Jordanian officials.

The source said that Jordanian and Iraqi officials had agreed to prepare copies of the tenders from the Iraqi side.

Turkey says wants to draw Baghdad into Kurdish oil deal

Reuters       Humeyra Pamuk

Turkey said on Monday it stood by a bilateral oil deal with Iraq's Kurdistan region that bypassed central government but wanted to win Baghdad's support by drawing it into the arrangement.

Reuters reported that Turkey and Iraqi Kurdistan signed a multi-billion-dollar energy package last week, infuriating a central Baghdad government which claims sole authority over Iraqi oil exports and is wary of any moves that could extend political autonomy to the region.

Turkish Energy Minister Taner Yildiz met Iraq's deputy prime minister for energy, Hussain al-Shahristani, in Baghdad on Sunday to try to mend ties with a federal government which says independent Kurdish oil exports would be illegal. The affair has soured relations between Ankara and Baghdad.

"We stand by the agreement we did with northern Iraq but we hope this can be carried out through a three-way mechanism," Yildiz told a conference in Arbil, the capital city of the Kurdistan region (KRG). "As Turkey, we are trying to move this forward in a careful and courteous way."

"We also would like to have the consent of the Central Government of Iraq for the commercial export of oil from the KRG to Turkey and start a trilateral cooperation scheme that will be beneficial to all."

The Kurdish north of Iraq has enjoyed autonomy since the 1990-1991 Gulf War when a U.S.-led coalition drove Iraqi occupying troops out of Kuwait.

Iran says gold trade with Turkey to resume

 Reuters

* Gold trade seen less than last year
* Trade boomed in 2012 as Iranians bought gold
* More Turkish banks seen working with Iran (Adds quotes, Halkbank, background)

Gold trade between Turkey and Iran will resume, albeit at lower levels than last year, once sanctions on Iran are eased, Iran's ambassador to Turkey said on Friday.

Turkey's gold trade with Iran boomed in 2012 when Ankara was paying for its natural gas and oil imports with Turkish lira and Iranians were using those deposits held in Turkey's Halkbank to buy gold.

"Certainly the gold trade between Iran and Turkey will resume," the ambassador, Ali Reza Bigdeli, told reporters in the Turkish capital on Friday.

"Due to the problems in money transfers in 2012, the gold trade rose. I don't think that we are still in the same situation that would require us to trade in gold in those amounts," he said.

Some of the gold was held inside Turkey in the peak of the trade, while some was taken to Dubai by couriers to be sold for foreign currency which was much needed by Iran and to which it did not have access due to tight Western sanctions.

This trade had dried up as a provision of U.S. sanctions, made law in the summer of 2012 and implemented from Feb. 6, effectively tightened control on sales of precious metals to Iran and prevented Halkbank from processing oil payments by other countries back to Tehran.

"There are a lot of areas between Iran and Turkey that we could trade, we should revive those too," Bigdeli said.

He also said Halkbank will maintain an important role in relations between Ankara and Tehran and that other Turkish banks are expected to work with Iran as risks ease.

Source:  http://mobile.reuters.com/article/idUSL5N0JE1OR20131129?irpc=932

Turkey, Iraqi Kurdistan sign landmark energy contracts

Reuters

Turkey and Iraqi Kurdistan signed a package of landmark contracts earlier this week that will see the semi-autonomous region's oil and gas shipped to international markets via pipelines through Turkey, sources close to the deal told Reuters on Friday.

The sources said the deals were signed during Kurdistan Regional Government (KRG) Prime Minister Nechirvan Barzani's three hour-long meeting with Turkish Prime Minister Tayyip Erdogan on Wednesday.

The move is likely to further infuriate Baghdad, which claims the sole authority to manage Iraqi oil and which said late on Thursday that any energy deal with Kurdistan would be "an encroachment on the sovereignty of Iraq".

Source:  http://uk.reuters.com/article/2013/11/29/uk-turkey-iraq-oil-idUKBRE9AS06720131129

US urges talks for energy in East Med

Hürriyet Daily News

The United States has called for continued dialogue between Turkey and the relevant parties in exploring energy resources both in the Eastern Mediterranean as well as in Iraq.

Carlos Pascual, the U.S. special envoy, called for dialog among parties on the potential resources that are yet to be explored in the Eastern Mediterranean, at the Atlantic Council Summit in Istanbul.
Discoveries of significant amounts of gas around Cyprus have brought with them political problems, as Turkey raised objections about exploration and ownership rights before a political settlement was reached on the divided island. Strains in Israeli–Turkish relations further complicated the transport of gas to a European market via Turkey, which experts agree will be the most commercial way.

It is too early to predict how Eastern Mediterranean gas will reach international markets according to Pascual, who said conversations between countries and companies would be critical to find the most commercially viable and politically acceptable solution.

Meanwhile Leonardo Bellodi, senior vice-president for public Affairs of ENİ said “things looked improved compared to a year ago,” when asked by the Hürriyet Daily News. Turkey had warned companies last year not to go ahead with exploration works in the Mediterranean or face consequences.

Iraq Kurds to Pump Oil to Turkey in Truce With Baghdad

Bloomberg        Selcan Hacaoğlu & Onur Ant

Iraq’s Kurds plan to start pumping oil to Turkey next month via a pipeline controlled by the central government in Baghdad, signaling an easing of their dispute over resources, according to two people familiar with the plan.

The new line will take Kurdish oil into the existing pipe that runs from Kirkuk in Iraq to Turkey’s Mediterranean port of Ceyhan, initially carrying 150,000 barrels a day starting in December, according to the Turkish energy industry officials who asked not to be identified because the information isn’t public. An Iraqi energy industry manager, who requested anonymity for the same reason, said the state oil company has accounted for the extra oil in 2014 plans.

Ashti Hawrami, the Kurdish Regional Government’s natural resources minister, said at a press conference last month that the 40-kilometer pipeline will have a capacity of 300,000 barrels a day. Mehmet Sepil, president of London-listed Genel Energy, said at the same conference that the pipeline from Dohuk to Fishkabur on the Turkish border will carry 200,000 barrels a day from its Tawke and Taq Taq fields.

The Iraqi official said the Kurdish oil will be metered when it feeds into the main pipeline, at Fishkabur near the Turkish border, and again when it arrives at Ceyhan.

The agreement signals a truce on the issue between the Iraqi Kurds, who say they should have control over oil and gas resources in the north, and the Baghdad government, which argues that all energy transactions need central approval.

Iraq’s Kurdish region pursues ties with Turkey — for energy revenue and independence

The Washington Post   Ben Van Heuvelen

As the rest of Iraq descends into a crisis of deepening violence, the autonomous enclave of Kurdistan is enlisting the help of an unlikely ally, Turkey, to reach for a long-delayed dream of independence.

In many ways, Iraqi Kurdistan already acts like a sovereign state. Kurdish authorities provide all public services, command their own army and control their own borders — including their heavily guarded southern border with ­Arab-majority provinces of Iraq. In Irbil, the Kurdish capital, most government buildings fly the Kurdish flag — not the flag of Iraq — and many members of the younger generation never learned Arabic and speak only Kurdish.

Until now, however, the Kurds have remained tightly tied to Baghdad because they depend on the Iraqi treasury for the vast majority of their regional budget.

That could soon change.

Putting aside years of hostility, Turkish and Kurdish leaders are quietly implementing an energy partnership agreement, signed earlier this year, that promises to provide the Kurdistan region with an independent stream of oil revenue.

The first major step in the plan is a pipeline that runs directly to Turkey, beyond Baghdad’s reach, and that will begin operating by the end of the year, according to the Kurdistan region’s minister of natural resources, Ashti Hawrami.

“It is our duty as Iraqis to pursue export routes for oil and gas, to secure our future,” Hawrami said.

Iraq vows to work with BP on controversial oil field

AFP

Iraq said Wednesday it would proceed with work alongside British energy giant BP on a controversial northern oilfield, in a move likely to spark anger in the country's Kurdish region.

The development of the Kirkuk oilfield, which lies amid a swathe of disputed territory in north Iraq, is at the heart of a row over land, oil revenues and the powers of the central government that has been raging for years between Baghdad and the autonomous Kurdistan region.

Iraqi Oil Minister Abdelkarim al-Luaybi, Kirkuk provincial Governor Najm al-Din Omar Karim and BP chief executive Bob Dudley visited the field after holding talks in the province's eponymous capital.

"The contract with the British company will be executed by treating the decline in oil production at Kirkuk oilfield, which has reached 230,000 barrels (per day), and the company will work on surveying the fields and sites of Kirkuk oilfield throughout the contract period," Luaybi told AFP.

Current output represents a significant drop off from the field's peak, and Iraqi officials hope to increase production to 500,000 barrels per day in three years.
 

Turkey, Iraqi Kurdistan clinch major energy pipeline deals

REUTERS        Hümeyra PAMUK & Orhan COSKUN

Iraqi Kurdistan has finalized a comprehensive package of deals with Turkey to build multi-billion dollar oil and gas pipelines to ship the autonomous region's rich hydrocarbon reserves to world markets, sources involved in talks said on Wednesday.

The deals, which could have important geo-political consequences for the Middle East, could see Kurdistan export some 2 million barrels per day (bpd) of oil to world markets and at least 10 billion cubic meters per year of gas to Turkey.

Such a relationship would have been unthinkable just a few years ago, when Ankara enjoyed strong ties with Iraq's central Baghdad government and was deep in a decades-long fight with Kurdish militants on its own soil.

But Turkey imports almost all of its energy needs and growing demand means it faces a ballooning deficit, making the resources over its southeastern border hard to ignore.

During a visit to Istanbul last week by Kurdistan Regional Government (KRG) prime minister Nechirvan Barzani, both sides agreed on the fundamentals of the deals and mapped out technical details for a second oil pipeline and a gas route from Iraq's north to Turkey, sources involved in the talks said.

Iraq says Big Oil to spend $25 bln next yr, despite unrest

REUTERS     Peg Mackey and Ahmed Rasheed

 
* Foreign oil firms due to spend over $25 bln in 2014
* Oil output in south expected to rise by average 500,000 bpd
* Giant southern oilfields, central fields seen safe from attack
* Smaller Nineveh oilfields, Anbar gasfield more vulnerable
* China seeks over 1 million bpd of Iraqi crude

Big Oil is poised to spend over $25 billion next year to boost output from Iraq's giant oilfields towards record rates, Iraq's deputy prime minister for energy said, even as Baghdad struggles to control spillover from the civil war in Syria.

Far from harm's way, the prized oilfields of southern Iraq - drivers of the country's oil expansion - are expected to pump an extra 500,000 barrels per day (bpd) in 2014, said Hussain al-Shahristani. Total output this year is set to average just over 3 million bpd, holding Iraq's rank as OPEC's no. 2 producer.

But Baghdad is raising its guard at the smaller fields of Najmah and Qayara - operated by Angolan Sonangol, which lie in the al-Qaeda heartland of Nineveh province in the northwest and at the Akkas gasfield, operated by South Korea's Kogas, in the western Anbar province near the Syrian border, he said.

"We are definitely concerned about the upsurge in violence, but our concern is for the Iraqi people throughout the country. Iraq is trying its best to combat terrorism," he said in an interview in his office in the heavily fortified green zone.

"The security situation has not affected the oilfields in the south and central Iraq and we haven't noticed any hesitation or slow down in investment by the companies."

Russian Oil Czar Reluctant to Change Buyout Offer

The Wall Street Journal       Gregory L. WHITE

Beyond his official post as chief executive of state oil company OAO Rosneft, Igor Sechin is a longtime confidant of President Vladimir Putin and widely seen as one of the most powerful people in Russia. So when his PR staff called the top editors of most of the country’s major newspapers late Friday night to summon them to an urgent briefing with him the next day, nearly all turned up.

But Mr. Sechin didn’t gather them at Rosneft headquarters in downtown Moscow to announce a new multi-billion-dollar deal with a global oil major or another giant project with customers in China. No, the reason he brought the editors, including two foreigners, out of bed on a Saturday morning was to respond to a complaint voiced a few days before by a small shareholder in one of Rosneft’s many subsidiaries.

Over the following two hours, ignoring the plates of fruit and Russian blini laid on the table, Mr. Sechin provided a window into the mindset of the man who runs the world’s largest publicly traded oil company by production.

He seemed less concerned about the substance of the shareholder’s complaint–the fund manager voiced a concern widely held in the market that Rosneft’s offer to buy out minorities was unfairly low–than the fact that the investor had taken it directly to Mr. Putin during a public question-and-answer session at an investment conference.

“This was an attempt to apply pressure, maybe even to manipulate the market,” Mr. Sechin said of the fund manager’s question to the president.

U.S. Is Overtaking Russia as Largest Oil-and-Gas Producer

Photo: AFP

The Wall Street Journal              
Russel GOLD  and Daniel GILBERT 

The U.S. is overtaking Russia as the world's largest producer of oil and natural gas, a startling shift that is reshaping markets and eroding the clout of traditional energy-rich nations.

U.S. energy output has been surging in recent years, a comeback fueled by shale-rock formations of oil and natural gas that was unimaginable a decade ago. A Wall Street Journal analysis of global data shows that the U.S. is on track to pass Russia as the world's largest producer of oil and gas combined this year—if it hasn't already.

The U.S. ascendance comes as Russia has struggled to maintain its energy output and has yet to embrace technologies such as hydraulic fracturing that have boosted American reserves.

"This is a remarkable turn of events," said Adam Sieminski, head of the U.S. Energy Information Administration. "This is a new era of thinking about market conditions, and opportunities created by these conditions, that you wouldn't in a million years have dreamed about."

Turkey's pipe dreams

Arabian Business       Lionel Mok

Turkey has continued to make the headlines in the Middle East’s oil and gas industry over the last several months due to a number of factors which include the growing divide between the Kurdistan Regional Government (KRG) and the Federal Government of Iraq (FGI); and the recent signing of the Trans-Adriatic Pipeiline (TAP) and Trans-Anatolian Pipelines (TANAP).

Despite its unremarkable national oil production industry that produces, on average, 50,000 barrels per day (bpd) from reserves that total approximately 270 million barrels of oil, the country has made itself critical to the world’s energy market, while also managing to satisfy growing domestic consumption of over 700,000 bpd.

Turkey owes its gravitational pull in the energy market to its physical geography. As the only landmass standing between the Middle East and Europe, and also the Black and Mediterranean Seas, Turkey is well positioned to become an energy hub and a transit point.

The country is in proximity to 71.8% of the world’s proven gas reserves and 72.7% of the world’s proven oil reserves. It neighbors Iran, Iraq the recently discovered Eastern Mediterranean reserves near Lebanon; and it is less than 250 kilometers away from the Caspian Sea, home of the world’s largest oil discovery in the last thirty years.

By 2004, the Turkish straits of the Bosphorus and the Dardanalles, had the capacity to transit 3.4 million barrels of oil to European markets every day. At the same time, a terminal on Turkey’s Mediterranean coast at Ceyhan, facilitates oil exports from northern Iraq via a pipeline from Kirkuk and from Azerbaijan through the Baku-Tbilisi-Ceyhan pipeline. The Kirkuk-Ceyhan pipeline is Turkey’s largest, with a capacity of 1.65 million bpd.

The planned TANAP will include a natural gas pipeline system running from the Georgia-Turkey border to the Turkey-Greece border, while the TAP, will transport the same natural gas from Greece via Albania and the Adriatic Sea to Italy and further to markets throughout Western Europe.

Iraq to Turn up Oil Tap This Year - Output to Rise by 300,000 - 400,000 Barrels a Day by 2014

The Wall Street Journal

Output to Rise by 300,000 - 400,000 Barrels a Day by 2014

Four years after war-scarred Iraq enlisted major oil companies to develop its oil fields, the country is about to turn up the tap.

Output is set to rise sharply in coming months with help from new oil fields in the south, Hussein al Shahristani, the Iraqi deputy prime minister for energy, said in Dubai on Tuesday.

The biggest contribution will come from the gigantic Majnoon field, where Royal Dutch Shell
PLC last week began testing production. Output there is expected to rise to almost 200,000 barrels a day before the end of the year, Mr. Shahristani said at a conference in Dubai.

The Halfaya field in southeastern Iraq should add another 50,000 barrels per day before the end of the year.

"There are increases in other fields, so in total we should add at least 300,000, perhaps more like 400,000 barrels," he said.

As Iraq is producing about 3.3 million barrels a day at present, that would make about 3.6 million or 3.7 million by the end of the year, he said.

The best market for the new oil in terms of cost would be Asia, he said, adding that Iraq wants to ship to different places as insurance against interruptions in trade routes. Iraq is also looking to ship oil through Syria along an established route once the civil war ends there.

Iraq Central Government Threatens to Cut Revenue to Kurds Over Pipeline to Turkey

Bloomberg Business Week

Iraq central government threatened to cut oil revenue to the Kurdish north in a deepening standoff over a new export pipeline that companies from DNO International ASA (DNO) to Genel Energy Plc (GENL) plan to use to ship crude from the region.

The government in Baghdad may refuse to give the 17 percent of annual earnings from oil sales allocated to the semi-autonomous Kurdish provinces if they bypass central authorities and start operating a link through Turkey by year-end, Hussain al-Shahristani, deputy prime minister for energy affairs, said in an interview in Dubai yesterday.

“We have our options, and you will hear them when we adopt measures, as this is a big loss for Iraq,” he said. “No Iraqi would accept that they take 17 percent of Iraq’s revenue from crude produced outside of Kurdistan and at the same time all of the revenue of the crude produced in Kurdistan.”

 

The Kurdistan Regional Government halted crude exports through the government-run pipeline in December amid a dispute with the Oil Ministry in Baghdad over the sharing of crude sales revenue and payments owed to companies such as DNO and Genel Energy. The Kurds, who are building export pipelines as a step toward self-sufficiency, estimate their oil reserves at 45 billion barrels.

The Iraqi government insists that the Kurds link their new crude export pipeline to the main government pipe at a metering station near the Turkish border, Shahristani said.

“They refused and said they want to link it after the metering station to prevent the Iraqi government from knowing the quantity of crude they are exporting,” he said. “The real problem is that they don’t want anyone to know how much they are producing and selling.” 

Turkey would struggle to cut Iran oil imports further: official

 Reuters

Turkey would struggle to cut its crude oil imports from Iran any further, a Turkish official said on Thursday, after the U.S. House of Representatives passed a bill to tighten sanctions on the Islamic Republic by further slashing its oil exports.

"Turkey has already cut the amount of oil it buys from Iran as much as possible. A further cut after this would greatly stretch Turkey," the official said.

Turkey's sole refiner Tupras has cut Iranian oil imports by around 40 percent to 110,000 barrels per day (bpd) and raised purchases from Saudi Arabia, Libya and Iraq.

http://www.reuters.com/article/2013/08/01/usa-iran-sanctions-idUSL1N0G12L320130801

OPEC's Oil Exports Revenue Breaks New Record But Split Deepens

The Wall Street Journal   Benoit FAUCON

Revenue from petroleum exports in the Organization of the Petroleum Exporting Countries broke a new record in 2012 but the earnings of some members are declining amid higher budgetary needs, underscoring a deepening rift between producers benefiting from higher oil prices and those who don't.

Mounting inequalities within OPEC come ahead of an expected debate later this year over whether it should formally cut its production for the first time in five years.

In its annual statistical report, OPEC said its oil exports revenue, which include crude, natural-gas liquids and products, rose by 9.2% to $1.261 trillion in 2012, compared to a previous record of $1.155 trillion the previous year.

Gulf Arab monarchies took advantage of higher oil prices and of a gap left by Iranian sales hit by sanctions. While Saudi oil revenue rose by 6%, Iran's earnings from the commodity fell by 12%.

But others have also been hurt by new competition from booming U.S. oil shale. Algeria's oil-export revenue fell by 6% as the price of its flagship Saharan Blend crude fell by 1.3% in 2012 amid weakening U.S. demand. The drop in revenue also stemmed from lower sales of its profitable products amid refining problems.

Anglo-Turkish company discovers new oil in KRG

Hurriyet Daily News

Genel Energy, Anglo-Turkish oil and gas independent, has announced that it has discovered new commercial oil reserves in northern Iraq.

In a written statement yesterday, Genel Energy confirmed the existence of a commercial oil discovery in the Ber Bahr 1 exploration well in the Kurdistan Region of Iraq (KRG).

“The Ber Bahr well adds a further commercial oil discovery to Genel’s already significant KRI resource base,” the statement said. The company plans to begin a phased development of the field in the second half of this year. Genel Energy holds a 40 percent working interest in Ber Bahr. Gulf Keystone Petroleum Ltd holds a 40 percent working interest and the KRG holds the remaining 20 percent interest.

Genel Energy now operates in seven sites in the KRG, including Chia Surkh, Dohuk, Miran, Bina Bawi, Taq Taq, and Kewa Chirmila. However, there is a long-running dispute between the central government in Baghdad and the autonomous KRG over how to develop the country’s resources.

Source: http://www.hurriyetdailynews.com/anglo-turkish-company-discovers-new-oil-in-krg.aspx?pageID=238&nID=47921&NewsCatID=348

Turkish Parliament opens way to oil market liberalization

Hurriyet Daily News

A petroleum market draft code has passed into law in General Assembly of the Parliament despite the opposition’s outcry over the measures which diminishes the role of state-owned TPAO in the market.

The Turkish Parliament’s General Assembly has approved a draft code on the petroleum market that comprises regulations to boost the dynamism in the sector by easing the circumstances for private actors and to end rentiers in the sector.

The new law, which is designed to regulate oil exploration and production operations in compliance with the country’s energy policies has passed into law late on May 29.

The government says the new regulations would liberalize the sector significantly.

But opposing groups say that it would leave the state-run Turkish Petroleum Company (TPAO) in a weaker position.

During the discussion of the draft in Parliament, one of the main opposition Republican People’s Party deputies attacked the draft, blaming the government for “not thinking to make exploration and production more efficient and rather seeking ways to please foreign capital.”

Sudan and Turkey to cooperate in energy

Hurriyet Daily News

Sudan and Turkey signed a memorandum of understanding in the areas of mining, power generation and hydrocarbons, during Turkish Energy Minister Taner Yıldız’s visit to the African country.

Yıldız said May 26 that they would encourage private sector players active in the energy sector – particularly in wind, solar and hydroelectric power – to invest in Sudan.

“We’d like to benefit from Turkey’s experience in industry, mining and transportation,” said Kemal Abdullatif, the Sudanese minister of mining. Also, Sudanese Electricity and Water Resources Minister Tabita Butros Shokia said they could cooperate with Turkey in wind, solar and nuclear energy.

Turkey and Sudan are set to cooperate in mining, hydrocarbons and electricity generation, particularly renewable energy, in accordance with the deals signed by Yıldız, Abdullatif and Shokia, following negotiations between technical delegations.

Yıldız said Turkey would assist with Sudan’s master power generation plan if help was requested. The minister also had talks about possible investment by the Turkish private sector to build a hydroelectric power station on the coast of the Nile river.

Turkey may buy ‘2 mln tons of Yemen LNG’