Iraq produces COVID-19 laboratory supplies to more rapidly test cases

In cooperation with the World Health Organization (WHO), the COVID-19 Crisis Cell of Basrah University in southern Iraq has successfully produced urgently needed laboratory supplies to speed up testing of suspected cases.

The global demand on supplies and equipment to fight COVID-19 has created a worldwide shortage of supplies. In particular, stocks of virus transport medium (VTM) – a gel-like substance used to preserve nasal swab specimens while they are being transported to laboratories – have been low.

As of 1 April, the University manufacturing team produced more than 1620 VTM, in addition to 3200 nasal swabs. These were delivered to health directorates in Iraq’s Basra, Muthana, Karbala, and Wasit governorates.

This new production, along with the Reverse Transcriptase-PRC (RT-PCR) kits provided by WHO, has facilitated the testing of hundreds of suspected cases in southern Iraq.

“The latest bottleneck to contain and reduce the spread of COVID-19 in Iraq has been the shortage of supplies and equipment needed to collect and transport samples,” said Dr Adham Ismail, WHO Representative in Iraq. “For this, WHO and Basra University have coordinated efforts to produce the essential laboratory products needed to test suspected cases, and together, we set the overall goal for supplying the quantities needed countrywide,” he added.

The new local production of VTM and swabs is a collective effort by Basra University, WHO, and other faculties like Al Zahraa Medical College, Faculty of Pharmacy, College of Sciences, and College of Agriculture, all in Basrah governorate. “We hope this will solve the domestic shortage issue resulting from the global demand,” said Dr Saad Shahin, President of Basra University.

The Basrah Crisis Cell has also announced 3 other COVID-19 response measures, including an online application for COVID-19 self-reporting. So far, the app has been used by 4500 applicants, of whom 130 qualified for further testing by the RT-PCR kits.

Disinfectants and sterilization material, including hand-rub gel, have also been produced locally with support from WHO and the Government of Iraq.

(Source: WHO)

By John Lee.

At least three rockets are reported to have hit near Halliburton‘s site in the Burjesia area of Basra early on Monday morning.

It is understood that the incident caused no casualties or damage.

It is the first attack to target US energy interests in Iraq in recent months.

(Sources: S&P Global Platts, AP, Sputnik)

Belgium, Netherlands and Sweden commit $5 million to tackle COVID-19 outbreak

The governments of Belgium, the Netherlands and Sweden have collectively committed US$5 million to support the Government of Iraq’s response to the COVID-19 crisis, in partnership with UNDP Iraq.

The funds, which were originally pledged under UNDP’s Funding Facility for Stabilization to help rehabilitate infrastructure damaged by ISIL, are now being urgently redirected to support UNDP Iraq’s initial $24 million COVID-19 response package.

Measures to combat the virus under this package include increasing the testing capacity of laboratories, providing personal protective equipment to healthcare workers, increasing the number of isolation wards, and undertaking assessments to establish post-COVID-19 recovery strategies.

Focusing on the most vulnerable communities in Iraq, activities will be rolled out in eight hospitals selected by local authorities in the underserved areas of Anbar, Diyala, Dohuk, Basra, Karbala, Najaf, Ninewa and Salah Al-Din.

Resident Representative of UNDP Iraq, Zena Ali Ahmad, said:

Containing the coronavirus outbreak is now the Government of Iraq’s number one priority, particularly as infection rates rise, putting more pressure on the Iraqi healthcare system outside the major capitals. We’re extremely grateful to Belgium, the Netherlands and Sweden for acting swiftly to commit these funds and being so flexible in administering them.

“Due to the strict curfews imposed by the Government of Iraq, we’ve had no choice but to temporarily halt the implementation of our stabilization activities. However, by capitalizing on the tried-and-tested processes of our successful stabilization work, we will respond to this unprecedented global health crisis with the speed and agility UNDP Iraq is known for.

Once this pandemic is under control, our stabilization activities will resume. Until then, we will work closely with the Government of Iraq, the World Health Organisation and other UN agencies to curb the crisis as best we can.

UNDP Iraq is currently discussing the remaining $19 million funding gap with other international partners.

Processes have been established to ensure that once funds have been committed, the response measures can be implemented immediately.

(Source: UN)

By Ahmed Tabaqchali, CIO of Asia Frontier Capital (AFC) Iraq Fund. This article was originally published by the LSE Middle East Centre.

Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Iraq’s Power Conundrum: How to Secure Reliable Electricity While Achieving Energy Independence

Iraq remains in a bind regarding how to secure energy independence within its geopolitical constraints – most pertinently the American sanctions on Iran. The US is continuing to maintain pressure on Baghdad by extending ‘final’ waivers on the purchase of Iranian gas for only another 30 days, as part of its new tougher stance.

Iraq, in response, could produce credible plans to eliminate its dependence on Iranian imports, which it accelerated with the approval in January of the fifth round of gas exploration contracts. However, achieving this would not end the need for Iranian imports, nor would it secure any kind of energy independence. More importantly, it will not change the shortages in the provision of electricity, which have served as a lightning rod for public anger over the failings of the post-2003 system.

Appreciating the dependence on Iran for the provision of electricity means delving into the extraordinary mess that is Iraq’s power grid, consisting of the power plants that generate electricity; transmission system that transport this electricity to population centres; and distribution networks which then distribute this electricity to end users. Decades of conflict have damaged most parts of the grid and, coupled with poor maintenance of the parts that escaped damage, this has rendered the grid impotent.

Rebuilding the grid post-2003 was hampered by the rolling dysfunction of successive governments, in which significant capital expenditures were neutralised by mismanagement, lack of coordination between ministries, and the county’s corrosive corruption. The public’s frustration over this impotence extends beyond the inadequate provisioning of electricity throughout the year, as the summer’s intense heat creates a particularly acute need for electricity, exposing the grid’s shortcomings.

These start at the generating stage with the gap between nameplate capacity, i.e. the maximum sustainable power output under ideal conditions, and actual output. While a gap always exists between these two, in 2018 the nameplate capacity was 30.3 gigawatts (GW), while effective capacity through the year was a mere 11.9 GW. A primary reason for this gap is the lack of appropriate fuel supply, in this case gas, which leads to substitutions by fuels such as crude or heavy fuel oil with the result that plants run at less than 60% of capacity – in 2018 only 62% of operating gas-powered plants actually used gas. Other reasons include poor maintenance and lack of cooling in high ambient heat. Moreover, up to 20% nameplate capacity in 2018 was non-operational.

In turn, this increases the gap between demand and supply – in 2018 average demand was 17.7 GW vs. effective generated power of 11.9 GW. But this gap is only part of the story, as the electricity generated to meet demand does not mean that it was actually delivered to end users. The total electricity generated in 2018 was 105.4 terawatt-hours (TWh), but only 43.7 TWh reached end users for a loss of 58.5%. Most of these losses take place at the distribution stage, with technical losses stemming from age, conflict damage, poor maintenance accounting for two thirds, and non-technical losses, mostly electricity theft, accounting for a third. Technical losses are natural, however they occur at an extremely high rate in Iraq, as do non-technical losses. Stolen electricity – still consumed but not billed – is estimated at 17 TWh, and so the electricity delivered would rise to 61 TWh, equating to a loss of 42.2%. This dynamic can be seen below.

Figure 1: Comparison between electricity demand and supply, 2010-18

The increase in losses from 2014 onwards can be attributed to the ISIS conflict, which damaged 20% of the transmission system and 5.0 GW of generating capacity. 2019 saw meaningful improvement as effective capacity increased from 11.9 GW to 14.3 GW, and crucially during the summer months peak generation was 19.3 GW vs. peak demand of 27.5 GW. This gap of 8.2 GW has narrowed from 2018’s 10.0 GW gap when peak supply was 16.5 GW vs. peak demand of 26.5 GW.

Electricity generated from Iranian electricity and gas imports accounted for 20.7% of that generated throughout 2019, and probably a much higher percentage during the peak summer months. These contributions from electricity imports from 2010 and gas imports from 2017 can be seen below.

Figure 2: Iranian contribution to Iraq’s energy requirements between 2010-19

The importance of Iranian electricity imports as a percentage of the total have steadily decreased, even though they increased in absolute levels; nevertheless, the decline in summer of 2018 was large enough to ignite the demonstrations in Basra. Imports in 2019 returned to the trend line and averaged 1.1 GW for the year. Plans for other regional imports include 0.5 GW to be imported from Kuwait by the end of 2020, rising to 1.9 GW over subsequent years, including planned imports from Jordan and Turkey.

Iranian gas imports were 7.0 billion cubic meters (BCM) in 2019, up from 4.1 BCM in 2018, and accounted for 31% of total gas consumed – up from 24% in 2018. Plans for increased domestic production include increasing captured flared gas to 16-19 BCM by end of 2021 from 12 BCM in 2019. Additionally, the fifth round of gas contracts call for replacing Iranian imports in three years, i.e. generating 7.0-10.0 BCM over that period from the current 3.5 BCM.

Assuming that the government executes these plans, in three years’ time this would replace the current electricity produced by Iranian imports. But demand is set to increase by 20% from current levels, meaning that the current the gap between supply and demand would increase by up to 20%. Moreover, planned capacity additions require additional fuel, which under existing plans is earmarked to replace imported gas. However, maintaining Iranian imports would significantly decrease their importance in power generation from the current 20.7%, and in the process Iraq would add meaningful capacity to address demand.

The goal posts are moving much faster than Iraq’s ability to approach them, and as such the US’s insistence on eliminating Iranian imports, far from achieving energy independence for Iraq, would instead exacerbate its energy vulnerabilities. Compounding these vulnerabilities is the massive investment spending needed to expand the grid’s capacity, currently unaddressed in the government’s structurally unbalanced budget, but which is ever more critical following the collapse of oil prices.

Iraq’s pathway out of this predicament, even at much higher oil prices, involves electricity tariff reform and the removal of energy subsidies, both the source of monumental waste and substantial market distortions. However, this requires a popular buy-in and for the increasingly alienated population to renew their belief in the post-2003 system’s legitimacy. It is here where the international community can help Iraq achieve energy independence.

Sources

The figures and charts used in the article are the author’s estimates, and are based on data from the Ministry of Electricity’s annual reports and conference presentations, the IEA, BP, MEES, Oxford Energy, and publicly available news sources. However, all errors and omissions are the author’s own.

The data used in the article exclude electricity demand and generation in the Kurdistan Region of Iraq (KRI). However, figures for locally produced and consumed gas include the KRI, and as such the Iranian-origin percentages of total gas consumed would be somewhat higher than the 31% and 24% used if the KRI was excluded.

Disclaimer: Ahmed Tabaqchali’s comments, opinions and analyses are personal views and are intended to be for informational purposes and general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any fund or security or to adopt any investment strategy. It does not constitute legal or tax or investment advice. The information provided in this material is compiled from sources that are believed to be reliable, but no guarantee is made of its correctness, is rendered as at publication date and may change without notice and it is not intended as a complete analysis of every material fact regarding Iraq, the region, market or investment.

 

By John Lee.

The China Petroleum Engineering & Construction Corp (CPECC) has reportedly won a $203.5 million engineering contract to treat sour gas at the Majnoon oilfield in Iraq.

According to Reuters, the field is now producing around 240,000 barrels per day (bpd), with plans to boost output to 450,000 bpd in 2021.

Originally awarded to Shell (45%), Petronas (30%) and the Maysan Oil Company (25%) in 2009, the field was taken over by the state-owned Basra Oil Company (BOC) at the end of June 2018, with operations and maintenance contracted to Chinese company Anton Oilfield Services Group (Antonoil) and the US company KBR.

(Source: Reuters)

By John Lee.

The China Petroleum Engineering & Construction Corp (CPECC) has reportedly won a $203.5 million engineering contract to treat sour gas at the Majnoon oilfield in Iraq.

According to Reuters, the field is now producing around 240,000 barrels per day (bpd), with plans to boost output to 450,000 bpd in 2021.

Originally awarded to Shell (45%), Petronas (30%) and the Maysan Oil Company (25%) in 2009, the field was taken over by the state-owned Basra Oil Company (BOC) at the end of June 2018, with operations and maintenance contracted to Chinese company Anton Oilfield Services Group (Antonoil) and the US company KBR.

(Source: Reuters)

By John Lee.

China’s Anton Oilfield Services (AntonOil) has reported that the Group has received written confirmation from its Iraqi customer in advance that it will automatically renew the 2-year contract after its expiry on July 1, 2020 for one year.

In its unaudited interim results for the one year ended 31 December 2019, it added:

“The Group is confident to rely on quality management to continue to create value for customers and strive to provide long-term and continuous management services for the oilfield. In addition, the Group will make every effort to expand towards the markets of other international oil companies in Iraq, actively seek cooperation opportunities with more international oil companies.”

It said that its large-scale integrated oilfield management project in Iraq has been running smoothly for one and a half years, and:

in 2019, the Company obtained a total of approximately RMB2,137.2 million of new orders in the Iraqi market, an increase of approximately 22.8% compared to RMB1,740.5 million in the same period last year; the Company recorded revenue of approximately RMB1419.8 million, an increase of approximately 21.3% from the RMB1,170.6 million in the same period last year.

The company is involved in the development of the Majnoon Oil Field in Basra.

(Source: Anton Oilfield Services)

WHO technical mission visits Iraq to step up COVID-19 detection and response activities

A high-level technical mission from the World Health Organization (WHO) concluded a visit to Iraq to support the Iraqi Ministry of Health response to COVID-19 (coronavirus) prevention and containment measures.

The mission, which comprised experts from the Regional Office for the Eastern Mediterranean Region and headquarters in Geneva, held a series of meetings with national health authorities to identify the disease detection dynamics and at-risk populations, in addition to providing guidance on strengthening response and control measures.

The mission also reviewed the Ministry’s overall readiness to deal with a potential increase in case reporting and the priority of establishing an Emergency Operation Centre to speed up action now that the disease has been announced as a global pandemic.

WHO experts visited the Central Public Health Laboratory to assess the national laboratory capacity and availability of test kits. They also visited the Communicable Disease Control Centre and designated health facilities in Baghdad to review the ongoing response by nationals and assess the technical support required in the coming period.

Iraq reported its first case of COVID 19 – an Iranian student in Iraq on 22 February 2020 – followed by 4 cases for members of one family with a travel history to Islamic Republic of Iran. Case reporting escalated to include almost all Iraqi governorates. The total number of cases reported as of 12 March stands at 83 confirmed cases, 24 recovered, and 8 deaths.

There is growing concern among the local health authorities about the possibility of domestic transmission of the disease which would challenge the already vulnerable health system in the country, stretched by years of wars and internal crises.

The health authorities have already banned major public events, suspended schools, and closed malls and gathering places until 21 March.

WHO has so far provided and will further provide the Ministry of Health at both central and regional levels with sufficient supplies of laboratory test kits and personal protective equipment to allow for a quick response to severe cases.

In addition, WHO is working around the clock to establish 3 negative-pressure rooms in Baghdad, Erbil and Basra to accommodate patients who might require more sophisticated medical treatment.

(Source: UN)

A 29 MW gas-fuelled power plant supplied by the technology group Wärtsilä to the Umm Qasr Ports Authority Zone in Basra, Iraq, commenced commercial operations in February. The plant ensures availability of a reliable supply of electricity to the port’s operations, which had previously been subject to frequent power interruptions.

The Wärtsilä plant was ordered in October 2018 by Lebanon-based Butec, the engineering, procurement and construction (EPC) provider for the project. Butec was contracted by Prime Metro Power Holdings (PMPH), the company having a Power Purchase Agreement (PPA) with the General Company for the Ports of Iraq, an Iraqi Ministry of Transport entity.

Wärtsilä delivered the plant on a fast-track basis, and the project was completed in an exceptionally short period of time, despite delays caused by the ongoing political situation in the country.

Guillaume Lucci, President and COO of PMPH, said:

We have been able to leverage the local natural gas resources to develop a first class, state-of-the-art power plant facility that adds a vital power generation infrastructure and services to the state of Iraq. The completion of this project in less than one year is a significant milestone in our strategy to quickly develop the needed power infrastructure.

“We are pleased to have worked with Wärtsilä on this project, and we are certain that the quality and performance of the engine will be an asset over the lifecycle of the plant.

Alexandre Eykerman, Energy Business Director, Middle East, Wärtsilä Energy Business, said:

“The fast-starting, flexible operation of the Wärtsilä engines was a decisive consideration in the award of this contract. The plant can run fewer engines when less power is demanded and start the additional engines only when and as needed. This provides a cost-effective, efficient, and highly reliable solution that will greatly enhance the port’s operations.”

The Umm Qasr plant operates on three Wärtsilä 34SG gas engines, which deliver reliable baseload power on a 24/7 basis. Wärtsilä has also signed a maintenance agreement, the scope of which includes field service, and engine maintenance planning based on remote monitoring and asset diagnostics. For this, the plant is already connected to the Wärtsilä Digital Expertise Centre located in Dubai.

In addition to providing cost predictability, the agreement ensures the safety, reliability, and efficiency of the plant’s operations. Wärtsilä will have technical advisors stationed on site for mutually agreed periods of time to supervise the plant’s performance.

This is the first phase of an overall power supply project that will be expanded to increase the availability of electricity throughout the region. It represents Wärtsilä’s first gas-fired power plant in Iraq.

(Source: Wärtsilä)

The Japanese Ambassador to Iraq, Mr. Hashimoto Naofumi (pictured), and Representative of UNESCO to Iraq, Mr. Paolo Fontani, on Tuesday 3rd of March 2020 signed an agreement in Baghdad in support of the project to support job creation for youth in Mosul.

The project aims to foster sustainable job creation for youth supporting the return of IDPs through quality TVET training for skilled construction workers.

The project will be implemented in synergy with other UNESCO activities under the umbrella initiative ‘Revive the Spirit of Mosul’ to coordinate international efforts in revitalizing educational and cultural institutions in Mosul, in close cooperation with the Government and the people of Iraq. This project will have linkages to the EU project “Reviving Mosul and Basra Old Cities”.

Director and Representative of UNESCO Iraq Office praised this innovative contribution:

“UNESCO is very grateful to the Government and the people of Japan. The project will empower young people in Mosul through supporting employment and self-employment and reduce the likelihood of marginalization and extremism.”

Ambassador Hashimoto highlighted:

“Japan has recently decided new assistance package for Iraq amounting to USD 41 million including this project as assistance for youth in Mosul. With this package, the total amount of Japan’s assistance to the people affected by the crisis reaches USD 540 million since 2014.

“I hope that the assistance from the Government and people of Japan will help foster sustainable job creation for youth in Mosul in reconstruction efforts”.

Japan has long been a valued donor to UNESCO in Iraq. In 2019, the Government of Japan supported the project “Voices of the children of Old Mosul: the rehabilitation and management of primary schools in historic urban context emerging from conflict”.

The project lays the ground for a holistic approach to the prevention of violent extremism in primary education with the provision of training to support the four key elements that influence the experience of children’s learning: parents, teachers, school principals and school policies and procedures.

(Source: UN)