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The oil policy of the new government: content, justification and indicators

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The oil policy of the new government: content, justification and indicators

Bertha News Agency
138 2018-10-12


In the next four years, as in previous decades, the oil sector is the backbone of the Iraqi economy.

This requires, or prefers, that the next government should have a coherent, well-defined oil policy, objectives and means that serve the national interest.

In light of this oil policy, the government is monitored, evaluated and accounted for periodically and according to quantitative indicators that are measurable, comparable and verified.


Ahmed Mousa Jeyad
Development and Research Consultancy / Iraq
Norway


This study aims to present a proposal for what is supposed to be included in the
oil policy in Iraq during the next four years, which will monitor, analyze and evaluate the activity of the new government in various aspects of the oil sector.

The oil and gas sector components and components and indicators (the longest part of the proposal);

Federal oil and gas law;

National Oil Company law;

Relation with the territorial government;

Transparency in the oil sector;

Corruption problems in the oil sector; The oil sector and oil smuggling;

the organic relationship between the oil policy and the general economic and development policy of the government;

avoid duplication of the past;

the role of experts and specialists.


The preparation of this proposal is based on continuous follow-up and the use of official information, foundations, indicators and standards in the international oil industry. Emphasis on practical aspects and realistic evidence, not abstract or abstract theories, and starting from the policy of oil as an obligation to be implemented by the new government, not a guiding document or requirements. Formality to pass the government program.

First: the structure of oil policy and the ruling regimes

The previous governments have not submitted any specific policy on oil policy.

As the current government will be under scrutiny and accountability based on its program for the next four years, the definition of its commitments or commitments regarding the oil sector and oil policy is what should be included in the "oil policy document."

1. It is preferable that the oil policy be presented as a separate document in its own right (or what is usually called the White Paper) or within the government program. It may be referred to in the government program and will be detailed later in a specific document.

2. Since the government program (prepared by the executive branch) is subject to the approval of the legislature, the oil policy document must be subject to the same approval.

3. The oil policy document should include the activities of the three basic sectors of the oil sector: The first includes exploration, development and production activities for oil and gas (Upstream). The second includes the activities of reservoirs, pipes, pumping stations and export facilities (Midstream)); Note that the petrochemical industry falls within these activities, but in Iraq falls within the functions of the Ministry of Industry and Minerals and not the Ministry of Oil.

4 - The most important thing that should be included in the oil policy document is a number of variables that can be identified by quantitative indicators that are measurable and verifiable for all the activities of the oil sectors mentioned above in addition to descriptive indicators. This effectively means:

First, to identify the starting indicators at the beginning of the implementation of the government program (let's assume the beginning of December 2018);

Second: the goals indicators (estimated at three levels: minimum, possible and ambitious) that the government is committed to achieve and defined on an annual basis;

Third, the financial, human, institutional and legislative requirements for achieving these goals; and fourth, potential challenges are categorized on the basis of the likelihood of the emergence of the challenge (high probability, potential and unlikely) and the effectiveness and impact of the challenge (very effective, influential and ineffective).

5. Since the government is accountable to parliament for implementing the oil policy, this requires that both authorities have an active role and a specific task in "following up and monitoring" the implementation of oil policy at least once a year. In implementation of this commitment, the Energy Committee of the General Secretariat of the Council of Ministers will be responsible for "follow-up" the implementation of the oil policy of the Ministry of Oil and the Oil and Energy Committee in Parliament the task of "monitoring" the implementation of the Government / Ministry of Oil for oil policy. Monitoring and monitoring reports should be presented, discussed and published periodically as a binding and agreed coordination action between the two authorities, different from parliamentary practices known as "summons".

6. The oil policy is reviewed and evaluated in light of the quantitative indicators detailed in the oil policy document and the above-mentioned "monitoring and monitoring" reports. In case of failure (compared to the minimum indicators), it is recommended to start the no-confidence measures or dismiss the Minister of Oil.

Second: Components, content and indicators of oil policy

It is possible, even necessary and practical, to determine the most important part of the oil policy document in each of the three sectors of the oil sector.

(1) Exploration, development and production sector

In this sector, he suggested that the oil policy document include the following:

1- Not to develop any new oil field except for the border fields (as discussed below) and not to refer any oil field produced or discovered to the international oil companies during the period of work of the new government.

The following data were used in this area:

According to the official information of the Ministry of Oil, the rate of Iraq's oil production reached 4.460 million barrels per day (Mbi) last August and that production capacity will exceed 5 Mb at the end of this year and will have a production capacity of 8 MB by 2025;

(2) As the new government is limited by four years, it must focus and pay attention to achieving about 6.5 Mb at the end of its constitutional term;

(3) that the oil fields contracted in the first and second rounds can achieve the required increase, especially that the final stages to reach peak production in the contracts of those fields will begin or be completed during the next government;

(4) There is no indication on the international level of the oil market and the share of OPEC and the share of Iraq within the OPEC, which shows that the production capacity of Iraq during the next four years can or should exceed 6.5 Mb;

(5) In the event that the rate of 6.5 Mb is justified, the development activities shall be "accelerated" within the limits of 8 Mb.

2- To limit any development of the non-contracted oil fields until August 2016 to the national effort exclusively with the use of the international oil service companies when necessary and within the traditional service contracts for the effectiveness and duration of the specified period; ie not to resort to contracting with international oil companies or holding license rounds to develop any Oil fields and structures discovered to date or to be explored during the next government.

The justifications for this restriction are:

(1) The activities of the national effort constitute the physical field for the development of human, institutional, knowledge and organizational capacities in this vital sector of the Iraqi oil industry;

(2) depends on the activities of the national effort on Iraqi cadres and thus contribute, even relatively, to address the problem of unemployment, especially among young people technically qualified more than the international oil companies, which usually prefer foreign labor; as evidenced by demonstrations in southern provinces since last July;

(3) As explained by the Ministry of Oil (but without providing physical evidence) that the cost of development through the national effort is much less compared to those carried out by the international oil companies;

(4) Certainly, the validity of "decision-making" is absolutely Iraqi under the national effort, while it is a partnership with foreign companies under the rounds of licensing rounds, which require "unanimity" when making the decision in the "joint management committees" for each field;

(5) The pattern, location and style of work of the national effort is usually locally while the offices of foreign companies are located outside of Iraq and this is reflected on the limited transparency of the work of foreign companies and the required effort, by the Iraqi authorities, to verify the credibility and realistic costs that companies claim to bear And paid.

3 - focus on giving priority to end the burning of associated gas. According to the latest statistical information available in the Ministry of Oil related to the month of August, which is clear that the percentage of burning associated gas in the southern provinces (Basra, Maysan and Dhi Qar) amounted to 60.4% of the total associated gas produced in those provinces. As for the percentage of all Iraq (excluding Kurdistan), it exceeds 56%. As the burning of associated gas represents a blatant waste of oil wealth and the waste of an important economic resource in addition to the enormous environmental damage at the time Iraq imports gas from Iran, it must include and ensure the oil policy of the new government as follows:

(1) To oblige the international oil companies contracting and executing the fields covered by the second round of licenses to implement the contractual clauses relating exclusively to the maximum utilization of associated gas;

(2) not to exempt any of these companies from their contractual obligations and to refer the matter to other companies outside the group that was originally contracted (as happened recently in the field of Gharraf); in addition to the consequent losses and additional costs unjustified legally / Contractual obligations. As it constitutes a contractual breach by the Iraqi side may lead to the activation of contractual material on international arbitration;

(3) the full implementation of the instructions of the General Secretariat of the Council of Ministers on this subject and codified in Recommendation No. 51 of 2018 related to the work plan on the requirements of the World Bank loan in this area;

(4) to determine the reduction in the associated gas burn and commensurate with the need to expedite the implementation of Iraq's obligations under the World Bank initiative known as "zero to the routine combustion of gas by 2030";

(5) the commitment of the government, especially the ministries of oil and electricity to provide gas required to generate electricity in specific quantities and timelines and the importance of the subject preferably to be monthly.

4. The development of the border fields is of particular importance, sensitive and distinguished by virtue of the possibility of joint development in the manner of "unification" with the neighboring country concerned, especially Kuwait and Iran. According to international experience, the adoption of the method of unification has the advantage in developing these fields because of many rationales and economic and operational considerations and sound management of the oil reservoirs. In anticipation of the high probability of adopting the method of unification with neighboring countries, I think that the oil policy document include the following:

(1) Any activity relating to the development of these fields shall be limited to the national effort exclusively until a unified development agreement is reached with the concerned State;

(2) In the case of the State concerned to accelerate the development of the border field unilaterally, the Iraqi side to give priority to the development of the Iraqi side of that field;

(3) The Iraqi government takes the initiative to urge the neighboring countries (especially Iran and Kuwait) to complete the necessary agreements to start the actual development of the important border fields by the method of uniformity in force internationally.

5- The fifth round of licensing. After the comprehensive evaluation of the contracts of this round by a selection of Iraqi oil experts have been concluded that these contracts serve the interests of oil companies at the expense of the national interest in addition to the conflict with the principle of achieving "the highest benefit to the Iraqi people," confirmed by the Constitution. For the above reasons and to date, the current government has not ratified any of these contracts. And so I see:

(1) that the next government does not ratify any of the contracts of the said round and returned them all to the Ministry of Oil;

(2) Since most of the contracts of this round related to the fields and border exploration exploratory, so the subject should be reviewed in light of the above mentioned regarding the development of border fields in the manner of unification.

6 - absolute prohibition of the practices of negotiation with foreign companies and the conclusion of agreements and contracts with them behind closed doors without transparency and not to disclose them completely. I also believe that the next government will not ratify any of these contracts which were not ratified before October 2, 2018. The reasons for this prohibition are:

(1) As the next government will be responsible for the implementation of its government program, the verification of the implementation of the government program requires transparency and disclosure and this is not possible when negotiations and contracts are confidential;

(2) It can not be ascertained that contracts signed in secrecy achieve "the highest benefit for the Iraqi people" affirmed by the Constitution;

(3) International experience shows that when such contracts have financial implications in secret or are not fully transparent, there is something important that the Contracting Parties want to conceal;

(4) That international evidence indicates a strong correlation between lack of transparency and corruption;

(5) Since everyone recognizes the widespread corruption in Iraq in a wide and influential, especially among leaders and decision makers at all levels, the lack of transparency in the negotiation and signing of contracts in the oil sector inevitably lead to corruption, and many evidence in this area;

(6) Iraq has an international obligation with EITI to disclose and even publish contracts in order to be consulted and to ensure that it serves the interest of the citizen.

7 - The next government undertakes to accelerate the implementation of the project of injecting sea water as soon as possible, especially the first phase of the project and preferably not less than the contribution of the national effort in the operational 51%. The justifications are based on the following:

(1) Since 2010, the Ministry of Oil has been discussing with some international oil companies about this vital project and it is time for actual implementation;

(2) Water must be injected to sustain oil production and compensate for the decrease in the natural pressure of the reservoir. This requires the injection of large amounts of water in proportion to the oil production from the fields concerned;

(3) Since the development of the fields of the first licensing round (Rumaila, West Qurna 1, Zubayr and three fields of Maysan - Bizergan and Fakkah and Abu West) enter or complete the final development phase during the next government, we are in fact a very awkward situation for the following reasons: The fields constitute the highest percentage of oil production in Iraq. Because they are productive fields and for many decades, the reservoir pressure is decreasing rapidly and at high speeds, which means the urgent need to inject water. Finally, the implementation and completion of the water injection project takes several years.

(4) It is not limited to the fields of the first licensing round above, but need the fields of the second licensing round, especially Halafaya and West Qurna 2 and crazy and Gharraf to inject water and the same applies to the field Ahdab;

(5) for cost considerations and acquisition of operational and technical experience and the possibility of implementing the project in two phases or more in the future, it is preferred to be the actual operational contribution of the national effort in the first phase by not less than 51%.

8. Refrain from demanding or calling for renegotiation of the contracts of the four licensing rounds. On the oil policy document of the new government to remember clearly and the futility of renegotiating the contracts of the first four licensing rounds. This position is based on the following data:

(1) proved all specialized studies that the service contracts adopted in those tours give Iraq the best financial return compared to any other contracts, especially the contracts of participation in production, including contracts of the Government of the Territory;

(2) Any renegotiation will give international oil companies a unique opportunity to obtain additional advantages that are very important and have a huge material impact at the expense of Iraq's interest for the duration of the contracts;

(3) The former Minister of Oil, Abdul Karim Laibi, made significant concessions to the oil companies without Iraq getting anything in return, so Iraq has the most powerful and strongest negotiating papers;

(4) The contracts of the first and second licensing rounds will be completed or reach the final stages of development of the fields concerned during the period of the new government; this means reaching the beginning of the peak production stage, which means covering the large percentage of the capital costs of the basic development of the fields and consequently any negotiation on these contracts or To change them is equivalent to the international oil companies, which is a flagrant violation of the Constitution - as mentioned above.

9. In the light of the above, the oil policy document should clearly stipulate the preference of service contracts for contracts of production participation, as well as the recognition that any form of production participation contracts and contracts of participation in revenues / profits are contrary to the principles of the Constitution. The justifications for such assertions are:

(1) focus the efforts of the Ministry of Oil to monitor the implementation of the development of the fields concerned within the contractual controls and effective control of the development costs to ensure access to peak production targets;

(2) provide some sort of stability and certainty in the contractual relations between the international oil companies and the Iraqi producing companies contracted with them;

(Iii) to block attempts to convert existing service contracts into production-sharing contracts;

(4) to block the attempts to adopt or call for or adopt any form of contracts of participation in production and contracts to participate in the returns / profits in the development of fields not currently contracted.

10 - Inventory of exploration activities by national effort only and when necessary in cooperation with foreign companies under technical services contracts limited duration. This recommendation is based on the following:

(1) According to official statistics of the Ministry of Oil, oil reserves currently confirmed about 153 billion barrels. If we assume that production by the end of this year is 5 million barrels per day, the life of oil reserves is up to 84 years;

(2) there is a very high probability that this reserve will increase significantly after the completion of the development of the fields of licensing rounds and the completion of exploration contracts, which means there is a very long time and appropriate to strengthen oil reserves;

(3) The confinement of the exploration activity to the national effort constitutes a very important incentive to develop the advanced technical, knowledge and technological capabilities of the Iraqi cadres rather than relying entirely on foreign companies.

11 - Intensify the development of Iraqi manpower, address gaps in skills and expand the use of advanced information technology. Why?

(1) The rapid and intensive development of Iraqi human resources and in the various related activities is one of the most important requirements of the development of the oil industry, which suffers from many knowledge gaps;

(2) Under the contracts of licensing rounds the first four allocated a total of 62.2 million dollars annually (this amount has dropped to about 50 million now because of the withdrawal or freeze the activity of some international oil companies) for the above purposes, knowing that Iraq does not bear or pay these annual allocations, Borne by the international oil companies contracted; this means providing the necessary annual funding that must be used in full and efficiently;

(3) It is assumed that the use of these annual amounts to increase the contribution of Iraqi cadres in the advanced positions and leadership in the management of these fields and to increase the contribution of Iraqi cadres working in those fields and not less than 85% as established in the contracts involved;

(4) It is necessary to provide a detailed annual disclosure of how these assignments were used, their results and their actual effects in raising and developing the efficiency of performance and bridging the various knowledge gaps.

(2) pipes, tanks and export installations (central sector)

Because of the development of some of the oil fields contracted under licensing rounds the final stages, which means - as mentioned above - to increase oil production, this requires the necessary capacity of the pipelines, tanks, warehouses and oil export facilities.

Accordingly, the oil policy document should state accurately and quantitatively the following indicators:

1. The capacities currently available (ie, before the new government assumes its functions officially) for each of the pipelines, reservoirs and export facilities of crude oil;

2. Projects currently under implementation and scheduling of completion of pipelines, reservoirs and crude oil export facilities;

3. The energies that the Government is committed to providing and the timeliness of pipelines, tanks and crude oil export facilities;

4. The above pipe and reservoir indicators shall not include those located within the limits of the area established for the fields contracted under the licensing rounds when such facilities are within the contractual obligations of the international oil companies concerned.

The next government is committed to the non-establishment of any public or joint governmental entity or company to establish, buy or own, in whole or in part, any reservoir capacity outside of Iraq for economic development considerations.

The next government pledges not to privatize any of the crude oil export facilities in the Arabian Gulf and not to refer any of the new facilities associated with the export of crude oil to private investment, whether Iraqi or non-Iraqi, for reasons of national security.

The government is working to achieve "export flexibility" through the multiplicity of export outlets, especially the rehabilitation and activation of Kirkuk pipeline through Turkish territory; and through Syrian territory - when security conditions improved there and Jordan. And that the government should seriously consider feasible alternatives - both economically and strategically - in intensifying access to Asian markets by sea or through pipelines through Iran.

Sumo occupies an important location and distinct privacy that goes beyond, in real terms and economic role, the oil sector to the entire Iraqi economy. In this regard, I think that the oil policy document include the following:

1. Providing and ensuring the necessary practical flexibility for SOMO, which helps it to carry out its "marketing" function efficiently and effectively according to the requirements of the market and its changes, on the one hand, and the relative importance of different types of oil produced (depending on the degree of density, sulfur content, etc.)

2. Not allowing Sumo to carry out activities outside its primary marketing mission without the approval of the government and parliament. The most important of these activities are characterized by risk or speculation or may result in losses or financial burdens or international obligations are "trading" and "hedge" and "share in profits" and "possession of physical assets outside Iraq";

3. To compel Sumo Company to comply with all the controls and requirements of transparency and disclosure in all its activities, and to publish the monthly reports in a complete and regular manner.

(3) oil refining and gas processing sector

The liquidation and gas manufacturing sector suffers from many problems. The new government must carefully diagnose and determine what it will do to address it in the oil policy document, especially since the studies and statistical information indicate a large and chronic gap between the quantity and quality of domestically produced petroleum products and local demand patterns. Iraq has to import large quantities to fill the deficit due to the introduction of refineries and technology used. The most important evidence of this is the proportion of fuel oil production, which during the first half of this year accounted for 45% of the total production of Iraqi refineries. The most important thing that should be included in the oil policy document is a set of quantitative indicators for the initiation, objectives and actions that the Ministry of Oil should undertake as follows:

1. Detecting the design capacities and actual operational capacities of each of the currently operating refineries and indicating the quality and quantity of all petroleum products produced therein (initiation line indicators);

2. Disclosing the quantity, quality and value of all exported and imported petroleum products;

3 - Determine the size of the design capacities and operational capacities of the new refineries that will be established during the period of government and the quality and quantity of all petroleum products to be produced by these new refineries (target indicators);

4 - The new government is committed to complete the construction of Kerbala refinery during the period of its mandate and give this preliminary refinery to complete it as soon as possible;

5 - The government is committed not to refer or accept the establishment of any refinery in the manner of investment does not have - at a minimum - European standards No. 5;

6. The Government shall absolutely refrain from purchasing or participating in the purchase, construction or participation in the construction of any refinery outside Iraq;

7 - The government undertakes not to allow any form of competition between the Ministries of Oil and Industry and Minerals in the field of petrochemical industries because this is causing serious damage to the Iraqi economy and the waste of efforts and financial resources (such as the case of the FAO refinery, which was transmitted without FEED studies and its impact on the project Nebras Petrochemicals). The Ministry of Oil is concerned with the liquidation sector and the Ministry of Industry and Minerals is concerned with the petrochemical industries;

8 - Terminating the contract of Maysan Investment Refinery, which was referred several years ago and suspiciously to Starim bankrupt company financially and non-qualified technically and non-specialized in terms of experience, which has not been completed until the date of anything !!

9 - Stop boring repetition in the re-advertisement of many refineries in the manner of investment, which has not been prepared FEED studies (such as Wasit refineries, Diwaniyah and Muthanna) without a small result, indicating the lack of interest of serious investors of those refineries. The new government should not wait and promise to start implementing at least one of the refineries that have paid Iraq millions of dollars to many international consulting companies to prepare feasibility studies and FEED studies. In contrast, Iraq will continue to import oil products, estimated at an annual cost of three billion dollars.

10- Urge the Basrah Gas Company to accelerate the development of its production capacity to reach the level of production specified in the contract and commensurate with the increase of gas associated with the oil fields Rumaila and West Qurna 1 and Zubair; This in turn will contribute to reduce the amount of burning associated gas on the one hand and increase the export revenues of liquefied gas and condensates Produced by the company. As the Gas Company of Basra is a joint company owned by the Iraqi government by the South Gas Company 51% of its shares, so the policy policy to determine the amount of oil in the production capacity of the Gas Company of Basra and its timing. The company should also publish information about the locally marketed products that have been exported and the revenues generated.

Third: Federal oil and gas law

There are at least four drafts of this law, all of which have become outdated and can not be implemented. Therefore, the next government has two alternatives: either the failure to introduce the law or introduce a new draft law is completely different and radical than any of the old versions of the law. If the second alternative is chosen, the 10-year experience with the above four formulas suggests that this requires intensive, complex and long-term efforts and may not work in the end.

Fourth: The law of the Iraqi National Oil Company

The appeal against this law submitted to the Federal Supreme Court by Iraqi citizens proved that the regulations submitted (October 3, 2018) to this court by both the legal agents of the Prime Minister and the Ministry of Finance correspond to the unconstitutionality of many articles of this law which may pay The Federal Supreme Court to accept the challenge of the law. Here, the new government has two alternatives: Either completely disregard this law or introduce a new draft law that is fundamentally and completely different from the law being contested.

But strange and within the pre-move to impose the fait accompli on the next government was appointed the current oil minister on October 9, 2018 President of the company !!!!!

Fifth: The relationship with the territorial government

The relationship between the federal governments and the region has a long, complex and difficult history since 2003 and so far. In view of the evidence and known positions, it is expected that the new government will solve the problems related to the oil issue with the Kurdistan Regional Government, but it must also insist on preserving the supreme national interest, which was raised during the past years and can still be summarized as follows:

1. The unconstitutionality and legality of the contracts signed by the provincial government with the various international oil companies (note that this is the subject of the lawsuit filed with the Federal Supreme Court against the territorial government several years ago, which has been activated recently and the case still exists to date);

2. Restrict all oil exports to SOMO and consider any export of crude oil outside SOMO smuggling and illegal trade (this is what all the federal governments, including the current ones, have officially stated);

3. Do not deal with Sumo with any of the companies or oil tankers that transfer and sell Iraqi oil smuggled through the region (and this is what Somo actually implemented);

4. Never allow the control of the regional authorities on any of the oil and gas fields belonging to the oil and gas companies of the north (and this is what was achieved after the defeat of the call for the restoration of control of the federal authority on Kirkuk at the end of last year);

5. not to allow the authorities of the region to do (or agreement with foreign companies) any exploration or development activity in the common or disputed areas (and this is the position of the Federal Government);

6. The failure of the Ministry of Oil to deal with any foreign oil company currently or in the future in any exploratory or developmental activity in the region (this prohibition is still in force despite the current oil minister violating it in favor of a UAE company for reasons that must be investigated officially);

7. The continuation of the Ministry of Oil under the pretext of international arbitration submitted to the International Chamber of Commerce Paris against the Turkish companies and government for violating international agreements signed between the two countries, especially those relating to the Kirkuk-Ceyhan oil pipeline line (which the Iraqi Oil Ministry estimates will win the lawsuit and large financial compensation);

8. Obligation of the territorial government to implement the provisions mentioned in the federal budget laws since 2004 concerning the settlement of the receivables of the export of oil revenues and other by the provincial government to the Federal Ministry of Finance (as mentioned in the annual budget laws and detailed report of the Federal Financial Control Bureau);

9. The demonstrations of citizens in Basra and the southern oil-producing provinces will not allow the federal government to give the region more than its benefits on the basis of the proportion of the population and on the basis of the delivery of all oil produced in the region to the federal government and issued from it be through the company Sumo (raised a banner reading " Basra for Basra ");

10. Finally, Iraq can not and should not bear all the burden of OPEC decisions when reducing production. It is assumed that Iraq's relationship with OPEC has, or should have, an importance and role in the oil policy of the new government.

But in return there are many factors and considerations that may lead to believe that the new government does not implement or succeed in the above task, including:

1. The role of what is known as "balanced and influential personalities" in the internal political situation and in the relationship between the two governments. For example, if Adel Abdul Mahdi receives the presidency of the government, his positions (as a friend of the Kurdish people as Massoud Barzani) and his well-known views contradict and contradict with the above;

2. The elections in the region, held a few days ago, are still subject to disagreement and opposition, and there is considerable skepticism about their transparency and credibility, which means that their results will not be recognized, which will inevitably affect both the parliament and the composition of the provincial government.

3. The election of the President of the Republic of Iraq has deepened the differences and tensions within the "Kurdish House" and may push the government of the province (controlled by Barzani family) to harden their positions with the federal government;

4. The problem of transparency and the fate of oil export revenues continues to be pursued by the provincial government despite the "formal" reports that were issued before the elections in the region;

5. The accumulation of the debts of the territorial government and the practices of "dependence" on the future oil revenues that have caused the region in the "debt trap";

6. The improvement in international oil prices may feel the government of the region under the weight of "financial pressure" on them, reducing the need for quick resolution of outstanding issues mentioned above with the federal government.

Sixthly, transparency in the oil sector has decreased

As the oil policy document covers many topics and includes a wide range of indicators of goals, which is the most important achievement of the criteria of the government's assessment, the document requires the adoption and determination of all quantitative and descriptive standards of transparency in the extractive industries and the rest of the activities of the oil industry, The Ministry of Oil must implement it fully.

The most important standards of transparency is the dissemination of accurate and complete information at specific time and periodic times related to the activities, achievements, contracts and negotiations of all bodies, departments and companies of the Ministry of Oil and foreign companies contracted according to international standards. And that the Ministry is committed to follow up the consequences of the dissemination of such information from opinions, studies and reports.

Seventh: Problems of corruption in the oil sector and oil smuggling

It is not new to say that corruption has become a widespread and institutionalized phenomenon in Iraq and in the Ministry of Oil where there are a large number of explicit or implicit accusations and sometimes even names and even sums indicating the involvement of senior officials in the ministry. But it is strange that no official in the ministry or its companies, who have been charged or suspected of corruption, has taken legal action against those charged.

There have also been increasing cases of overtaking oil pipelines and oil products and the emergence of the phenomenon of "smuggling of oil", especially in the province of Basra and also referred to the involvement of officials in this phenomenon.

Because of the negative and catastrophic effects of various forms of corruption and oil smuggling on this sector and on the national economy, the oil policy document of the new government must take a decisive, clear and strong position to combat and eliminate these negative phenomena and identify the means and indicators that will be used to prove the completion of its commitments.

Eighth: The organic relationship between the oil policy and the economic and development policy of the government

Because of the structure of the Iraqi economy adopted largely, if not entirely, on the oil sector, oil policy has an effective impact on the economic development policy of the country as a whole. Reconstruction, debt repayment, and the provision of basic services and requirements that previous governments have failed to provide require the new government to coordinate fully and fully.

However, because the National Development Plan 2018-2022 is, as its predecessors, indicative and not binding on implementation, while the government program is binding and will assess the government in the light of its implementation, it will depend on the details of the government program and the consistency and harmony of the various policies, tools and entities that will be adopted by the program.

Ninth: Avoid duplication of the current government program, which focused only on "increasing oil and gas production to improve financial sustainability"

and in brief general terms without quantitative indicators that can be used to measure achievement. While the task of the new government - the Government of providing services - assumes, as mentioned above, many of the goals and tasks that the new government undertakes to implement and indicators of implementation and verification.

At the same time, Iraq should not be seen as a testing ground for utopian ideas that are not well thought out and are not economically and socially feasible and move away from populist ideas and practices. The demonstrations in the southern provinces clearly indicate the gravity of the situation.

Tenth: the specialized professional role of Iraqi oil experts and economists

In the light of the importance of oil policy and its effective impact on the Iraqi economy rests with all the faithful and keen on the interest of the country and the good use of its oil wealth, especially experts and specialists oil and economists together and stand firmly and force against all attempts to harm the supreme interest of the Iraqi people.


Ahmed Mousa Jeyad
Development and Research Consultancy / Iraq
Norway


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