From Al Jazeera. Any opinions expressed are those of the authors, and do not necessarily reflect the views of Iraq Business News.

Iraq’s vast oil wealth once paid for some of the best health services in the Middle East.

But decades of conflict and political unrest have led to, what the government admits, a crisis in hospitals.

Things are particularly bad in Basra province where people have long complained of government neglect.

Around 70 children are being treated for cancer in Basra Children’s Hospital.

Experts say pollution from surrounding oilfields is one of the reasons why Basra has the highest rate of cancer in Iraq.

Al Jazeera‘s Charles Stratford reports:

By John Lee.

A rocket has hit a residential and oil operations headquarters near Basra city, wounding three workers at an Iraqi drilling company.

The short-range Katyusha missile hit a compound in Burjesia which is used by several international oil companies (IOCs), including ExxonMobil.

Oil production and exports are not expected to be affected.

(Sources: The Guardian, Bloomberg, Xinhua)

JICA to Support Iraq’s Reconstruction and Revitalization through Upgrade of Basrah Refinery

Signing of Japanese ODA Loan Agreement for Iraq

On 16 June, 2019, the Japan International Cooperation Agency (JICA) and the Iraqi Government signed a loan agreement at Ministry of Finance in Baghdad.

The ODA (Official Development Assistance) loan amounting to JPY 110,000 million (approximately USD 1 billion) will be used for Basrah Refinery Upgrading Project. The loan agreement was signed by H.E. Mr. Fuad Mohammed Hussein, Minister of Finance and Masayuki Hirosawa, Chief Representative of JICA Iraq Office, in the presence of H.E. Mr. Hamid Younis Salih, Deputy Minister of Oil and H.E. Mr. Naofumi Hashimoto, Japanese Ambassador to Iraq. This concessional ODA loan aims to support the Government of Iraq in its efforts to reconstruct the country and revitalize its economy.

The loan named “Basrah Refinery Upgrading Project (II)” is the second tranche loan for Basrah Refinery Upgrading Project, one of the mega projects known in the region. For the same project, JICA previously concluded two loan agreements for (i) the engineering services loan in the amount of JPY 2,079 million and (ii) the first tranche loan in the amount of JPY 42,435 million.

The entire project aims to increase the quantity and quality of oil products including gasoline, diesel and kerosene, by installing a new refining plant called Fluid Catalytic Cracking (FCC) Complex in Basrah Refinery, which is one of the biggest oil refineries currently operational in Iraq. It will be implemented by South Refineries Company, Ministry of Oil.

Iraq has the world’s fifth-largest proven oil reserves and is currently OPEC’s second-largest producer. Nevertheless, most of the existing refineries in the country have been shut down or decreased their production capacity, suffered from damages and deterioration in the previous decades of conflicts. Many of the plans to construct new refineries have faced with challenges and delays and are yet to achieve substantial increase of the refining capacity.

On the contrary, the ongoing reconstruction efforts in liberated areas and the revitalization of socio-economic activities across the country have prompted huge demand for fuels, such as gasoline and diesel. As a result, despite being one of the largest oil producers, Iraq has no choice but to import the significant amount of oil products from neighboring countries so as to meet the demand for transport, power generation and industrial production.

Against this backdrop, the project to construct Iraq’s first-ever FCC Complex will increase the volume of the high-value added oil products, promote the transfer of refining technologies from Japan and help save valuable foreign currencies to import huge amount of fuels. The new plant will also reduce sulfur content in the products in accordance with the international environmental standards. Furthermore, the project is expected to pave the way for energizing private sector involvement in the downstream of Iraq’s energy industry and provide economic opportunities for the people of Iraq, especially in Basrah.

The loan is very concessional with the low interest rate and long repayment period: the interest rate of 0.20% and the repayment period of 40 years including 10-year grace period.

(Source: JICA)

By John Lee.

FBM-KNM FZCO, an indirect wholly-owned subsidiary of Malaysia’s KNM Group, has been awarded a contract for the supply and delivery of replacement heat exchangers to the Khor Al Zubair’s gas processing plant in Basrah Province.

According to a regulatory statement, the contract from Basra Gas Company (BGC) is worth USD 2.096 million (equivalent to approximately RM8.739 million based on the exchange rate of USD1.00 : RM4.17).

The project is to be completed by 14th January 2020.

(Source: KNM)

By John Lee.

Ride-hailing service Careem has reportedly started operations in Basra.

According to The National, the company, which currently operates in Baghdad and Najaf, also has a pilot project in Erbil.

Careem entered the Iraqi market in January 2018, and was bought by Uber for $3.1 billion in March 2019.

(Source: The National)

US-based Capstone Turbine Corporation (Nasdaq: CPST) has announced today that it has secured an order for two C600 Signature Series microturbines to provide 1.2 megawatts (MW) of energy to power a triethylene glycol (TEG) dehydration facility in the Basra region of Southern Iraq.

The order also includes Capstone’s new self-cleaning pulse filtration system which will allow the microturbines to endure the remote and sandy conditions with minimal maintenance. The order was secured by Technical Solutions to Industry FZE (TSI), Capstone’s authorized distributor to Iraq and United Arab Emirates (UAE).

Fueled by available raw gas, Capstone’s two C600S microturbines will power 100% of the new dehydration facility. The new facility is part of a larger 25-year joint venture between local gas and leading oil producer’s efforts to capture, treat and monetize associated gas currently being flared from three southern Iraq oilfields.

Capstone recently developed a new line of self-cleanable severe environment air filtration systems for its Signature Series line of microturbine products to facilitate its expansion into the oil and gas business in the Middle East as part of its overall double digit revenue growth strategy.

The company announced its intentions to expand its business into the Middle East a couple of years ago and has previously delivered successful projects in Oman, Qatar, Saudi Arabia and the UAE. Capstone expects that higher oil prices and the move towards reduced gas flaring will continue to drive demand and should provide a positive backdrop for Capstone’s low emission microturbine solutions.

Darren Jamison, President and Chief Executive Officer of Capstone, said:

Flaring is the traditional way to dispose of unwanted gas produced during oil exploration activities, but the long standing practice creates an immense amount of carbon dioxide emissions and adds to climate change.

“In Iraq alone, 16 billion cubic meters (bcm) of natural gas is flared annually, making it a wasted resource that could instead provide electricity or other benefits to meet the predicted doubling demand by 2030.

Iraq is one of the world’s biggest energy producers and is set to become the fourth-largest oil-producer by 2030 behind the United States, Saudi Arabia and Russia according to the IEA report, Iraq’s Energy Sector: A Roadmap to a Brighter Future 2019.

At the same time, 60-70% of gas produced is being flared due to the lack on infrastructure causing Iraq to import natural gas from the neighboring country of Iran. To improve efficiency and help with shortfalls due to rising electricity demand, the Iraqi government is working with international gas companies to capture and utilize its resources versus flaring.

Jim Crouse, Executive Vice President of Sales and Marketing for Capstone, said:

As pressure for more efficient and environmentally conscious oil and gas production increases, we continue to see an increased demand for microturbines for flare reduction applications.

“Capstone, through its distributor network, is committed to do its part by educating and working with producers and local operators for a more profitable production. Flare reduction applications like this in Basra can have a payback as short as one year which makes it an economic win as well as an environmental win.

(Source: Capstone)

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

After decades, Iran, Iraq ready to Dredge the Shatt al-Arab

Hope of restoring a clean water lifeline to Basra province is on the rise again with plans by the Iraqi and Iranian governments to revive the Shatt al-Arab as a source of drinking water and improve its functioning as a trade route.

Click here to read the full story.

By John Lee.

Oil production in the Al Faihaa area (Block 9) in Basra is reportedly expected to increase in the coming year with increasing investment.

Dragon Oil CEO Ali Al Jarwan told Oil & Gas Middle East that the company plans to increase production in Iraq to 100,000 barrels per day (bpd) by 2025.

(Source: Oil & Gas Middle East)

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

ExxonMobil evacuated dozens of its non-Iraqi employees from Iraq on May 18. The evacuation follows a US State Department decision to withdraw its non-essential staff from the US Embassy in Baghdad and its consulate in Erbil, the capital of Iraqi Kurdistan.

The US oil company relocated its employees to Dubai, where they will continue their work related to the West Qurna-1 oil field in Basra. The company announced May 31 that it will begin returning its employees from June 2 after the Iraqi government promised to increase the security measures in the site.

Click here to read the full story.

By John Lee.

According to a report from Reuters, employees from Exxon Mobil will start returning to work at the West Qurna 1 oilfield on Sunday.

Sources told the news agency that the company had received assurances from the Iraqi Ministry of Oil and the Basra Oil Company (BOC) that its staff would receive extra security.

Earlier in the month, the company evacuated about 30 foreign engineers from Basra as a “temporary precautionary measure”.

(Source: Reuters)