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Al Majal was delighted to participate as an exhibitor in the 8th Maysan International Exhibition and Conference for Energy, Construction, and Investment, which was held from February 20th to 23rd, 2023, at the University of Maysan.
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Al Majal’s Oil & Gas Market Roundup in Collaboration with Qamar Energy
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Latest in the Iraqi & Global Energy Markets
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The World Bank announced its 2022 autumn forecast of Iraq’s 2022 growth at 8.7% as higher crude production and record oil exports in conjunction with high oil prices brought in record oil revenues and pushed international reserves to their highest levels in more than two decades.
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Last year marked the third year that Iraq has failed to pass a budget, after 2014 and 2020. MP Ma’een al-Kadhimi, a member of the country’s Parliamentary Financial Committee, says that the draft 2023 budget envisages spending of US$ 153 B, up US$ 64 B from 2021’s previous budget of US$ 89 B,
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Key Iraq Events – Oil and Gas
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Iraq’s crude output hit its lowest in 10 months in January at 4.29 Mb/d, according to Energy Intelligence estimates, below its OPEC+ production target of 4.431 Mb/d.
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Iraq’s nationwide exports fell in January to 3.64 Mb/d from December’s 3.72 Mb/d. The disruptions at the terminal made up most of the 128 kb/d drop in total exports.
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Iraq’s oil ministry signed six oil and gas contracts that had been awarded in its fifth licensing round in 2018.
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Iraq is on the brink of losing a deal to develop one of its largest free gas fields following Chinese Sinopec’s request
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TotalEnergies agreed to extend the deadline by one month to finalise the US$ 27 B package of energy deals with Iraq, following a rocky meeting between Iraq’s PM Sudani, Oil Minister Abdulghani and Total’s Pouyanné late January.
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The KRG’s independent oil and gas sector has taken another blow. This time from Swiss-based trading house Trafigura which has ended a 10-year long-term crude marketing contract with the semi-autonomous government.
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The Central Bank of Iraq is planning to allow trade from China to be settled directly in yuan for the first time as the bank attempts
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Iraq’s US$ 11 B giant petrochemical project (Nebras) is set to be revived after a number of decisions were taken by the Cabinet early February,
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OPEC demand growth forecasts show a downward adjustment in Q4 2022 as Chinese oil demand fell due to reduced mobility and manufacturing activity following a resurgence in CoVid-19 cases and the slight slowdown in OECD countries towards the end of the year. OPEC expects 2023 demand to increase by 2.3 Mb/d, the IEA by 1.9 Mb/d, and the EIA by 2.1 Mb/d as of January 2023.
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Top Energy Deals in the Region
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The consortium of Masdar, Infinity Power Holding, and Hassan Allam Utilities has announced the signing of a framework agreement with Egypt to develop a 2 GW green H2 project in the Suez Canal as part of its 2 MoUs to develop two green H2 plants, one in the Suez, and another on the Mediterranean.
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Regional Rig Count (1): OPEC+ Pressure to Keep Iraq Rig Count Low
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Middle East oil drilling has still not fully recovered from the sharp drop induced by the pandemic and the related OPEC+ production cuts. However, it is likely to start expanding as quotas increase and production growth plans in the UAE and Iraq get underway. Iraq has 54 active rigs as of January 2023, all drilling for oil. This number has not increased since the start of 2022, but is up 2 on December 2021, and 11 on April 2021. In 2019, prior to the pandemic, Iraq had 77 active rigs targeting oil. Middle East gas drilling is starting to show a moderate recovery, supported by the beginning of Qatar’s LNG expansion projects and renewed efforts by Saudi Arabia towards its 2030 gas ambitions.
Note: Iraqi gas rigs are not reported by Baker Hughes, likely because Iraq reports gas rig figures clubbed with oil rigs and/or lack of response from contractors (drilling for non-associated gas is at minimal levels compared to oil, although it should pick up as Sinopec’s development of Mansuriyah and the Pearl Petroleum consortium’s expansion of Khor Mor, and potentially work by Halliburton at Akkas, move forward).
* End of Qamar Energy’s contribution, for more information about Qamar Energy, please visit www.qamarenergy.com
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Iraq Oil Market Highlights
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