The Cabinet held its regular weekly meeting in Baghdad on Tuesday under the chairmanship of Prime Minister Mr. Adil Abd Al-Mahdi. It approved:

  • the recommendation of the Ministerial Energy Council on the service contract for Al-Mansuriyah oil field in Diyala province;
  • a draft law on public-private partnership to strengthen cooperation between government agencies and the private sector;
  • the draft agreement between the Republic of Iraq and the Kingdom of Saudi Arabia on the avoidance of double taxation and the prevention of tax evasion’
  • measures to meet the requirements of elections to provincial councils outside the Kurdistan Region of Iraq;
  • recommendations for development of the Safwan border crossing between Iraq and Kuwait in Basra province.

(Source: Govt of Iraq)

By John Lee.

The United Nations has advertised new positions in Iraq:

(Source: UN)

(Picture: Finger pressing a new career start button, from Olivier Le Moal/Shutterstock)

By John Lee.

The United Nations has advertised new positions in Iraqi Kurdistan:

(Source: UN)

(Picture: Success, growth, career, development signpost from 3D_Creation/Shutterstock)

Genel Energy has announced its unaudited results for the six months ended 30 June 2019.

Bill Higgs (pictured), Chief Executive of Genel, said:

These results demonstrate the continued success of our strategy -highly cash generative productionunderpins capital investment in growth opportunities that deliver rapid returns and enables a compelling cash return to shareholders through our dividend.

“Our production grew 17% in H1 2019, and pro forma free cash flow rose to $76 million. This cash generation, and our strong balance sheet, allows us to both increase investment in growing the business as well as returning cash to shareholders via dividends. Accordingly, we have today announced an interim dividend of $14 million.

“Disciplined capital allocation remains at the core of our business. The speed with which our investments pay back means that cash is quickly recycled to create most value for shareholders. The cash that our production generates funds worknow underway at Sarta and Qara Dagh, with plenty left over to both pay a dividend and seek new opportunities, as we progress Genel’s growth strategy.

Results summary ($ million unless stated)

H1

2019

H1

2018

FY

2018

Production (bopd, working interest) 37,400 32,100 33,700
Revenue 194.3 161.1 355.1
EBITDAX 1 167.3 137.4 304.1
  Depreciation and amortisation (74.8) (63.6) (136.2)
  Exploration (expense) / credit (0.6) (0.5) 1.5
  Impairment of intangible assets (424.0)
Operating profit / (loss) 91.9 73.3 (254.6)
Cash flow from operating activities 142.3 125.1 299.2
Capital expenditure 72.2 34.1 95.5
Free cash flow2 56.7 70.1 164.2
Pro forma free cash flow2 75.6 70.1 164.2
Dividend payments 27.4
Cash3 353.3 233.2 334.3
Total debt 300.0 300.0 300.0
Net cash (debt)4 55.8 (63.8) 37.0
Basic EPS (¢ per share) 27.2 21.3 (101.6)
Underlying EPS (¢ per share)1 59.9 49.2 109.0
  1. EBITDAX is operating profit / (loss) adjusted for the add back of depreciation and amortisation ($74.8 million) and exploration expense ($0.6 million). Underlying EPS is EBITDAX divided by the weighted average number of ordinary shares
  2. Free cash flow is set out on page 7 and does not include $18.9 million, invoiced for Tawke production and due in June 2019 and received late on 9 July 2019, with the delay due to a change in the Operator’s banking arrangements. Pro forma free cash flow of $75.6 million includes this payment.
  3. Cash reported at 30 June 2019 excludes $10 million of restricted cash and the $18.9 million noted above
  4. Reported IFRS debt less cash

Highlights

  • Working interest production averaged 37,400 bopd in H1 2019 (H1 2018: 32,100 bopd), an increase of 17% compared to H1 2018
    • 8 wells completed in H1 2019, resulting in year-on-year production increases at both the Tawke and Taq Taq PSCs
  • Free cash generation of $57 million in H1 2019 (H1 2018: $70 million), which increases to $76 million when including the post period receipt of $19 million, with annual free cash flow yield of c.20% of current market capitalisation
  • Net cash of $56 million at 30 June 2019 (net debt of $64 million at 30 June 2018)
    • Following the receipt of all payments relating to April 2019, Genel had $390 million of cash as of 5 August 2019, a net cash position of $92 million
  • Addition of Sarta and Qara Dagh to the portfolio in January 2019 provides near-term production and material future growth potential
  • Maiden dividend distribution of 10¢ per share paid on 24 June 2019
  • Interim dividend of 5¢ per share confirmed
  • Genel retains an open mandate for a share buy-back programme of up to $10 million, and will continue to review purchasing opportunities

Outlook

  • Net production guidance in 2019 maintained at close to Q4 2018 levels of 36,900 bopd, an increase of c.10% year-on-year
  • Drilling programme ongoing, with over 10 wells set to be completed by early 2020
  • Active discussions with the Kurdistan Regional Government (‘KRG’) regarding Bina Bawi are ongoing, focused on agreeing the detailed commercial terms for the integrated Phase 1 oil and gas development and approval of the associated field development plans
  • Work continuing at Sarta to prepare for production by the middle of 2020
  • QD-2 well location agreed at Qara Dagh, well pad civil engineering work set to begin
  • Farm-out process relating to Somaliland acreage to begin in late Q3 2019
  • Genel expects to generate material free cash flow in H2 2019, even while investment in growth increases
    • 2019 capital expenditure is expected to be towards the top end of the $150-170 million guidance range
  • Searches for a new Chairman and Chief Operating Officer are progressing
  • The Company continues to actively pursue growth and is assessing opportunities to make value-accretive additions to the portfolio

More details here.

(Source: Genel Energy)

By Huda Baroud for Al Monitor. Any opinions expressed here are those of the author and do not necessarily reflect the views of Iraq Business News.

Palestinian Prime Minister Mohammad Shtayyeh visited Iraq July 15 to discuss importing Iraqi fuel. This falls within the Palestinian Authority (PA)’s quest for gradual economic disengagement from Israel.

Shtayyeh was accompanied to Baghdad by a delegation composed of Minister of Finance Shukri Bishara, Minister of Foreign and Expatriate Affairs Riyad al-Malki, Minister of National Economy Khaled Assali, Minister of Agriculture Riyad Attari and Palestinian intelligence service head Majid Faraj. The delegation met with Iraqi Prime Minister Adel Abdul Mahdi, President Barham Salih and parliament Speaker Salim al-Jabouri.

Click here to read the full story.

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Click here for details.

(Source: chevening.org)

By John Lee.

US-based Lockheed Martin Aeronautics has been awarded a $315,604,174 cost-plus-fixed-fee contract, for F-16 Contractor Logistics Support Phase IV.

This contract provides the contractor logistics support and establish a training detachment at Balad Air Base, Iraq, for the government of lraq.

Work will be performed at Balad Air Base, Iraq; and Greenville, South Carolina, and is expected to be complete by Dec. 31, 2022.

This contract involves 100% foreign military sales to the country of Iraq. This award is the result of a sole-source acquisition.

(Source: US Dept of Defense)

By John Lee.

US-based Lockheed Martin Aeronautics has been awarded a $315,604,174 cost-plus-fixed-fee contract, for F-16 Contractor Logistics Support Phase IV.

This contract provides the contractor logistics support and establish a training detachment at Balad Air Base, Iraq, for the government of lraq.

Work will be performed at Balad Air Base, Iraq; and Greenville, South Carolina, and is expected to be complete by Dec. 31, 2022.

This contract involves 100% foreign military sales to the country of Iraq. This award is the result of a sole-source acquisition.

(Source: US Dept of Defense)

Iraq’s oil ministry said on Sunday it has no connection with an oil tanker seized by Iran’s IRGC in the Persian Gulf for smuggling fuel, a report said.

“The ministry does not export diesel to the international market,” the Arab country’s oil ministry said in a statement, Iraqi News Agency reported.

Iraq’s relevant authorities are working to gather information about the seized vessel, it added.

Two Iraqi port officials said initial information obtained show that the seized ship is owned by a private shipping company which is owned by an Iraqi private trader.

In a statement on Sunday, the IRGC Navy’s Public Relations Department said that the foreign ship had been captured by the military vessels patrolling the second naval zone in the Persian Gulf as part of the operations to detect and fight against organized smuggling.

The IRGC Navy’s patrol vessels confiscated the foreign tanker that was carrying 700,000 liters of smuggled fuel in a surprise operation after coordination with judicial authorities, it added.

According to the statement, the foreign ship was seized near Farsi Island, a tiny, barren island in the Persian Gulf.

(Source: Tasnim, under Creative Commons licence)

Several members of Iraq’s parliament and the province’s deputy governor visited prisons near Mosul, Iraq, calling what they found a “humanitarian catastrophe.”

This happened two days after Human Rights Watch (HRW) released research detailing the horrible conditions of the prisons, which hold terrorism suspects.

Immediately after our report release, local authorities claimed Human Rights Watch’s research was “fallacious.” But the government’s tone has since changed. One parliamentarian admitted that “what Human Rights Watch reported was small relative to the actual catastrophe inside the prisons of Nineveh.

Nongovernmental organizations working on these issues have said that Human Rights Watch’s research has made their work easier. Human Rights Watch has also been told that the report release has positively supported their work and has sparked serious conversations in Baghdad about addressing prison conditions.

More here

(Source: HRW)