Iraqi delegation to seek Japanese partners in oil reconstruction

Sydney (Platts)--7Sep2004

A delegation of representatives from Iraq's oil and gas sector will visit
Japan next week to discuss the involvement of companies, such as Nippon Oil
Corp, in rebuilding the country's devastated industry, the head of the Iraqi
Engineering Services and Trading Co and member of the delegation Sabah
al-Shammery told Platts Tuesday. Speaking on the sidelines of the World Energy
Congress in Sydney, al-Shammery said the Iraqi oil industry had also received
strong support from Australian companies and the Australian government's trade
mission both locally and in Baghdad, although talks were still at an early
stage. "Australia can contribute a lot to the Iraqi oil industry," he said. He
said the Iraqi oil industry required investment of around $15-bil to restore
it to the production level of 1990. "But $1-2-bil would get the industry back
on its feet...producing around 3.2-mil b/d of oil," he added.

Iraq's oil minister Thamer Ghadban has said the Iraqi oil industry would need
some $15-bil to reach post-war production targets as the energy sector
struggles against ongoing acts of sabotage. Instability has also slowed the
reconstruction of the country's oil infrastructure. In five to seven years,
the Iraqi oil industry could be producing 10- to 12-mil b/d, "if we get the
investment and infrastructure and international policy allows for it,"
al-Shammery said, adding Iraq was the only country that could currently bring
2- to 5-mil b/d of low cost oil production to the market. "The reality is Iraq
has the biggest potential to control oil," he said. Oil production costs in
Iraq are around 25-50cts/bbl, compared with Saudi Arabia's production costs of
$2.5-3/bbl, al-Shammery added. The country is also estimated to have around
five times published reserves.

Copyright © 2004 - Platts

Please visit:  www.platts.com

Their coverage of energy matters is extensive!!.