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.

Iraqi factions a wild card in US-Iran blame game

It’s hard to tell what’s really on the minds of Iranian and US officials in the flurry of words they’ve exchanged this week, but Baghdad has been perfectly clear about any potential confrontation between the two: not in my backyard.

Amid prolonged dares and double-dares between Tehran and Washington — punctuated with claims from both sides that they don’t want a war — Iraq has made it known it won’t become a proxy battleground.

Click here to read the full story.

By Padraig O’Hannelly.

Last week, the US Embassy in Baghdad ordered the departure of non-emergency U.S. Government employees from Iraq, as tension mounts between the Trump administration and neighbouring Iran. In the meantime, several other organisations have taken similar moves.

While this has made headlines, has there been any real change on the ground?

Iraq Business News spoke with Martin Aggar, General Manager of Al-Burhan Security, to get his perspective on developments.

He says that while some people have changed their travel plans in response to the increased tensions, in practice little has changed in Baghdad:

Our operations team is closely monitoring the situation, and apart from one minor incident last night, there has not been a significant increase in security-related activity or general threat levels.

“Nevertheless, some clients have chosen not to leave our secure accommodation at the Al-Burhan Centre.

“But with meeting facilities on site, and also at our villa in Al-Mansour, we can still help them to see the people they need to see while visiting Iraq. We’re equipped for all situations.”

The events of the past week seem to many to be at odds with the general trend in Iraq. Aggar explains:

This all comes against a background of steadily improving conditions in Iraq; people feel safer, infrastructure is improving, and international companies are taking more of an interest in the opportunities to be had here.

“That’s why we’ve invested in the newest and best armoured vehicles, a VIP meet-and-greet service at the airport, and the full package of services that executives need and expect when they come here to do business.

“And our sister company Al-Burhan Airways is the only private operator licensed to fly helicopters in Iraq, so we can bring visitors quickly and safely wherever they need to be in the country.

Asked how he expects this to play out, he says:

The current tensions are the result of Iran-US relations, and while they don’t originate in Iraq, they do of course influence this country.  

“However, the Iraqi government is very focussed on developing the economy and moving Iraq forward.

“The opportunities are huge and the people are determined to succeed; I think in future we’ll look back on this as the early stage of a boom period for Iraq.

By John Lee.

Oil Minister Thamer al-Ghadban has criticised ExxonMobil‘s decision to temporarily evacuate staff from the West Qurna oil field as “unacceptable and unjustified”.

In a statement on Sunday, he said the move was “political“, and pointed out that other international oil companies are continuing to work freely.

According to CNN, the company evacuated about 30 foreign engineers from Basra as a “temporary precautionary measure“.

(Sources: Ministry of Oil, CNN)

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

An apparent rocket attack has hit the high-security Green Zone. The area houses key government buildings and the United States embassy.

Iraq’s state-run news agency says a Katyusha rocket crashed in the area without causing any casualties.

Al Jazeera’s Charles Stratford joins us from Baghdad to discuss the latest updates:

By John Lee.

Plans by Iraqi Airways to resume flights between Baghdad (pictured) and Damascus have reportedly been postponed.

Syria’s Ministry of Transportation said it had been informed of the “decision to postpone the trip of two Iraqi Airways planes today… until further notice,” according to Rudaw.

The Iraqi Embassy is said to have notified the Syrian foreign ministry that “the completion of some administrative and organizational steps between the company and the Syrian civil aviation” authority is needed before flights can resume.

(Sources: Rudaw, Facebook)

GardaWorld, a global leader in comprehensive security and risk management, has made its weekly security report available to Iraq Business News readers.

Prepared by GardaWorld’s Risk Analysis Team in Iraq, this essential report includes short- and medium-term outlooks on the security situation, reports and commentary on recent significant events, and a detailed overview of developments across the country.

Please click here to download the latest report free of charge.

For more information on how GardaWorld’s services can support your business in Iraq, please contact Daniel Matthews, Senior Director Iraq, at daniel.matthews@garda.com

Stephen Whyte, Chairman of Genel Energy, gave the following update on the business at the Company’s Annual General Meeting, held in London on Thursday:

Genel had a very successful 2018, with free cash flow generation of $164 million even while making significant investment in growth.

2019 has seen us continue this success. We are delivering year-on-year production growth, we have made portfolio additions that perfectly complement our existing asset base, and our cash position continues to strengthen.

Genel is participating in 20 wells this year, the most of any IOC in the Kurdistan Region of Iraq (‘KRI’). Drilling on the Tawke and Peshkabir fields is ongoing, with activity ramping up as we progress through 2019. Year to date production from the Tawke PSC is currently c.126,800 bopd, with Peshkabir driving impressive growth compared to the prior year’s period.

The drilling programme at Taq Taq has now delivered three successful wells, and year to date production is currently c.13,300 bopd, an increase from the 2018 average of 12,350 bopd. We are continuing to achieve successful results from the flanks of the field, and are drilling ahead at pace.

Total Genel working interest production across all assets is 37,600 bopd, running slightly ahead of our expected 10% increase in year-on-year production.

Even as we invest to deliver this production increase we continue to improve our cash position, generating almost $50 million in free cash flow in the first four months of the year. We expect to keep up this impressive run rate. Our current expectation is that we will generate well over $100 million in free cash flow over the course of 2019, prior to the payment of the dividend, even after increasing expenditure on our growth opportunities.

The results at Peshkabir show the significant success that can be obtained from our low-cost, rapid return operations in the KRI. While investing to increase production from 12,000 bopd to 55,000 bopd over the course of the year, Genel still generated $50 million of free cash flow from the asset. This level of return is hard to match anywhere else in the world, and illustrates why we continue to look for further opportunities in the KRI.

Put simply, the KRI is a very good place in which to operate. Payments have been made on a monthly basis for over three and a half years now, the political situation continues to improve – with Baghdad having made budget payments to the Kurdistan Regional Government for over a year – and the low-cost of operations helping to set a breakeven oil price at an asset level of $20/bbl.

We are still looking to diversify the portfolio, but we will not ignore further opportunities in the KRI – and indeed continue to focus on these where our presence on the ground and regional expertise mean we can maximise their value potential for shareholders.

In that context, as you are probably aware by now, we were delighted to add Sarta and Qara Dagh to the portfolio. They tick all of the boxes, as we partner with Chevron on assets that offer a mixture of near-term production and long-term growth potential.

Sarta is expected to enter production in the middle of 2020, and we will develop the field utilising a similar strategy to the one that was so successful (and cash-generative) at Peshkabir. While we do not want to get ahead of ourselves there are hydrocarbons throughout the structure in all of the typical KRI reservoirs, from the Tertiary down to the Triassic.

We are focused on building an even stronger business with material growth potential, providing a clear and compelling investment case that offers the opportunity for a significant increase in shareholder value. As we prioritise that growth, we have also initiated a material and sustainable dividend, providing investors with a compelling mix of growth and returns.

I am delighted that Bill Higgs is now sitting alongside me as CEO, and that Esa Ikaheimonen, our CFO, has also joined the Board.

On a personal level, the transition that I was keen to oversee is now complete. As such I have decided that this will be my last AGM as Chairman of Genel, and I will leave the Company for new challenges once a suitable successor has been identified. When I joined the Board two years ago the share price was under 80p, production was declining, Genel had unpaid oil receivables of over $400 million and $142 million in net debt.

Genel’s production and net cash position is now rising, the portfolio is positioned to provide material organic growth, and Genel now has the right team to deliver that growth. Management has a wealth of experience in the sector, experience that can also be utilised to make further value-accretive portfolio additions and optimise our growing cash pile to generate value for shareholders.”

Genel will announce results for the six months ending 30 June 2019 on Tuesday 6 August 2019.

(Source: Genel Energy)

Advertising Feature

Rabee Securities Iraq Stock Exchange (ISX) market report (week ending: 16th May 2019).

Please click here to download a table of listed companies and their associated ticker codes.

The RSISX index ended the week at IQD622 (+4.3%) / $669 (+4.3%) (weekly change) (-5.7% and -5.7% YTD change, respectively). The number of week traded shares was 7.1 bn and the weekly trading volume was IQD2.6 bn ($2.1 mn).

ISX Company Announcements

  • Fallujah for Construction Materials (IFCM) will hold an AGM* on May. 29, 2019 to discuss and approve 2013, 2014, 2015 and 2016 annual financial results. The company has been suspended from trading since Jul. 6, 2015 by an ISC decision due to not disclosing 2013, 2014, 2015 and 2016 annual financial results.
  • According to the Board of Insurance, Ahliya for Insurance (NAHF) will resume trading on Sunday (May. 19, 2019).
  • Dar Al-Salam for Insurance (NDSA) completed its capital increase procedures from IQD5.0 bn to IQD7.0 bn through 40% rights issue.
  • Babylon Hotel (HBAY) invited its shareholders on May. 14, 2019 to receive their cash dividend for the years between 1997 and 2001 as well as the year of 2016.

Five One Labs is pleased to announce IGNITE, our very first entrepreneurship program focusing on achieving product market fit.

This program will help you better understand the market you are competing in and how you can create the most value for your customers.

We are now recruiting tech-entrepreneurs from communities all around Iraq to participate in this month long program.

If you are passionate about a tech-focused startup idea and want to learn the skills to turn it into a business, this program is right for you!

Apply by May 21 at 11:59pm to be considered.

More details here.

(Source: 51 Labs)

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.

The National Iranian Oil Company (NIOC) decided May 4 to open an economic representative office in Iraq.

The decision was made during a meeting bringing together executives at Iraq’s Oil Ministry and Iranian oil industry equipment producers, on the sidelines of the Iran Oil Show 2019.

Ramin Gholampour Dezfouli, NIOC’s director for support, construction and goods supply, said only Iranian companies approved by the NIOC will be able to partake in Iraqi Oil Ministry projects.

Click here to read the full story.