By John Lee.

Iraq’s Council of Ministers has approved a contract with Japan’s JGC Corporation to build a 55,000-bpd refinery in Basra province.

According to a statement from the Ministry of Oil, the new plant will create 7,000 jobs, in addition to 70,000 during the construction phase.

The General Manager of the South Refineries Company (SRC), Hussam Wali, said construction is hoped to start early next year, and be completed within four years.

The $4-billion project will be funded by a loan from the Japan International Cooperation Agency (JICA).

(Source: Ministry of Oil)

By John Lee.

Swedish company Linxon has won an order of around $80 million to the Ministry of Electricity in Iraq for delivery of four turnkey 132/33 kV GIS substations. The contract forms part of the Electricity Sector Reconstruction Project (Phase 2) financed by Japan International Cooperation Agency (JICA).

The delivery includes all needed equipment (High Voltage 132 kV GIS, 132/33 kV power transformers, 33 kV switchgear, control & protection system, communication system etc) as well as design, civil construction works, installation and commissioning. The delivery time is 18 months and the project will start around July, 2020.

Frédéric Tréfois, CEO of Linxon, said:

We are honoured to have received this mandate and are grateful for the collaboration and support by JICA in financing this project.

“This type of EPC (Engineering, Procurement and Construction) project truly demonstrates the confidence of our clients in our comprehensive offering and our ability to deliver enhanced value.

“We have a good relationship and long-standing experience working with the Ministry of Electricity in Iraq in helping the country to ramp up it’s electricity capacity. I am proud of the Linxon team demonstrating resilience and winning this award during the current situation“.

JICA is the agency implementing Japan’s Official Development Assistance (ODA). JICA works proactively to address development challenges in Iraq by utilizing Japanese ODA loans. The Electricity Sector Reconstruction Project supports construction of power transmission and distribution facilities in Iraq, where the demand for electricity is especially high.

Linxon is a joint venture company set up in 2018 by SNC-Lavalin and ABB to deliver turnkey electrical AC substation projects.

(Source: Linxon)

By John Lee.

Swedish company Linxon has won an order of around $80 million to the Ministry of Electricity in Iraq for delivery of four turnkey 132/33 kV GIS substations. The contract forms part of the Electricity Sector Reconstruction Project (Phase 2) financed by Japan International Cooperation Agency (JICA).

The delivery includes all needed equipment (High Voltage 132 kV GIS, 132/33 kV power transformers, 33 kV switchgear, control & protection system, communication system etc) as well as design, civil construction works, installation and commissioning. The delivery time is 18 months and the project will start around July, 2020.

Frédéric Tréfois, CEO of Linxon, said:

We are honoured to have received this mandate and are grateful for the collaboration and support by JICA in financing this project.

“This type of EPC (Engineering, Procurement and Construction) project truly demonstrates the confidence of our clients in our comprehensive offering and our ability to deliver enhanced value.

“We have a good relationship and long-standing experience working with the Ministry of Electricity in Iraq in helping the country to ramp up it’s electricity capacity. I am proud of the Linxon team demonstrating resilience and winning this award during the current situation“.

JICA is the agency implementing Japan’s Official Development Assistance (ODA). JICA works proactively to address development challenges in Iraq by utilizing Japanese ODA loans. The Electricity Sector Reconstruction Project supports construction of power transmission and distribution facilities in Iraq, where the demand for electricity is especially high.

Linxon is a joint venture company set up in 2018 by SNC-Lavalin and ABB to deliver turnkey electrical AC substation projects.

(Source: Linxon)

Siemens Energy and the Iraqi Ministry of Electricity have signed a contract for the Al Hamudhia substation, which will provide reliable and efficient power supply to the cities of Ramadi, Fallujah, Saqlawyah, Khalediyah and surrounding areas in Al Anbar governorate, North West of Baghdad.

Located about 20 kilometers away from Ramadi city, the turnkey 400- kilovolt (kV) Al Hamudhia substation will support greater grid connectivity and allows for a higher utilization of the Al Anbar power plant’s generated power, supporting anticipated energy demand growth of 10% annually.

Ammar Mohammed Kadhim, General Director of Planning and Studies Department, Iraqi Ministry of Electricity and the Head of the Japanese loan team “IQP22” projects at the Ministry, which are being financed by the Japan International Cooperation Agency (JICA), said:

A top priority for the new government of Iraq is rebuilding the country’s power infrastructure. Upgrading and strengthening the Iraqi power grid is crucial to this ambitious plan, which will ultimately support Iraq’s economic, industrial and infrastructure development.

“We’re already working on comprehensive grid projects across the country in collaboration with international partners, like Siemens, to deploy the most reliable and advanced technologies.

The new substation will connect up to 750 Megavolt Amperes (MVA) to the national grid, helping decrease bottlenecks and transmission losses. Construction of Al Hamudhia station is expected to start in July 2020, and is scheduled for completion in July 2022.

Mahmoud Hanafy, Senior Vice President, Transmission Solutions at Siemens Energy, Middle East, said:

The new substation will support in providing reliable power to the homes and industries in the governorate of Al Anbar.

“Our grid technology enables more reliable, sustainable, efficient and flexible power systems. From transporting electricity from power plants to the distribution stations, all the way to the citizens, our ability to optimize flexibility and efficiency will contribute to boosting the transmission infrastructure of Iraq.

Part of the JICA’s projects in Iraq, the 400-kV Al Hamudhia’s scope of work includes the design, construction, equipment supply, erection, testing and commissioning and training of personnel. The project will be completed by Siemens Energy’s engineers in collaboration with specialized local Iraqi subcontractors.

The company is currently building 13, 132/33-kilovolt substations as part of the Siemens Roadmap for the Electrification of Iraq. These projects aim to strengthen the country’s electricity transmission and distribution network – with a particular focus on the governorate of Basra as well as the other governorates that are located in the middle and south of the country. Siemens is also supplying 35 power transformers to support the Iraqi power grid.

In April 2019, Siemens and the Government of Iraq signed an agreement to implement Phase 1 of the Roadmap, which is designed to meet the country’s reconstruction and power sector goals, and includes the addition of new and highly-efficient power generation capacity, rehabilitation and upgrade of existing power plants and the expansion of transmission and distribution networks. Following Siemens Roadmap for the Electrification of Iraq agreement, 791 MW of electricity has already been added to the country’s grid.

(Source: Siemens)

JICA (Japan) and UNDP Partnership Agreement to Accelerate the Projects for Socio-Economic Development in Iraq

Japan International Cooperation Agency (JICA) and UNDP announced a renewed agreement and commemorated the 10th anniversary for their partnership to accelerate the implementation of socio-economic infrastructure projects in Iraq to improve the economic recovery and living condition of Iraqi people in key sectors such as electricity, water and sanitation, oil, irrigation, transportation, industry, health and communication. The GoI welcomes the reinforced partnership between JICA and UNDP.

Since 2008, JICA has signed 31 loan agreements, total amount of which is JPY 830 billion (equivalent to USD 7.7 billion), with Iraqi Government for economic and social infrastructure projects and programs in Iraq to improve daily lives of Iraqi people. In order to ensure accountability, transparency and efficiency in project implementation, the Government of Iraq (GoI) and the Government of Japan/JICA jointly established a monitoring mechanism called Monitoring Committee (M/C) in 2008. UNDP has undertaken the supporting role to assist and advise the M/C based on the partnership agreement between JICA and UNDP.

Under this partnership, UNDP has been working alongside JICA and the Government of Iraq (GoI) on project monitoring and capacity development. UNDP identifies bottlenecks pertaining to project implementation, providing analyses and recommendations for action on cross-cutting issues to the M/C to accelerate project implementation.

The M/C is the longest continual committee in the GoI system as the 43rd M/C Meeting was held on 4th July 2019 in Baghdad with Iraqi ministries to update the progress and find the solutions for challenges that the projects face in order to accelerate the project implementation and deliver the public services to the Iraqi people.

The GoI, JICA and UNDP reconfirm all parties’ continual efforts to enhance this tripartite collaboration mechanism to expedite the improvement of national strategic infrastructures, which will contribute to better public services as well as to the private sector development for more and better job opportunities.

(Source: UN)

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)

Japan’s Mitsubishi Corporation has been awarded a contract for port construction in the Republic of Iraq.

Extended by the General Company for Ports of Iraq (GCPI), the contract covers a port rehabilitation project in the country’s southern region of Basra, and is valued at approximately 110 million US dollars. The project is being funded through ODA loans provided by the Japan International Cooperation Agency (JICA).

The project will be executed through a partnership between MC and multiple international contractors, including Turkey-based energy infrastructure provider Calik Enerji (CE), in which MC holds shares, and construction firm Gap Insaat, also Turkey-based.

Both part of the Calik Holding group, these two sister companies will play a major role in executing construction while MC will be responsible for overall project coordination and serve as the prime contractor, facilitating the import of steel structures and other necessary supplies from Japan.

The objective of this project is to modernize existing industrial port facilities around Basra by (i) expanding the oil products berth at Khor Al-Zubair Port, and (ii) building a new service berth for working ships and service boats at Umm Qasr Port.

The rehabilitation of ports throughout Iraq is essential to meeting increasing demands for port infrastructure, which is growing rapidly as the volumes of trade flowing in and out of the country grows. Rehabilitating this critical infrastructure will also contribute to further stabilizing the country’s economy as post-war reconstruction advances.

This project is particularly noteworthy given that Khor Al-Zubair and Umm Qasr are the only ports currently in operation in the Basra region, where a system of ports located in the 48 kilometer wide tip of the country wedged in between Iran and Kuwait along the Persian Gulf gives Iraq its only outlet to the sea.

In addition to this project, MC intends to continue leveraging provisions under the Japanese Government policy framework for promoting export of “high-quality infrastructure” to identify opportunities that support Iraq’s efforts towards reconstruction, economic development, and increased quality of life.

(Source: Mitsubishi Corporation)

(Picture: Takehiko Kakiuchi, President and CEO of Mitsubishi Corporation)

JICA to Support Reconstruction through Development and Rehabilitation of Water Supply and Irrigation Facilities:

On 3 May, 2018, the Japan International Cooperation Agency (JICA) and the Iraqi Government signed two loan agreements at Ministry of Finance in Baghdad.

These two ODA (Official Development Assistance) loans, amounting to JPY 34,880 million (approximately USD 329 million) in total, will be used for Basrah Water Supply Improvement Project (II) and Irrigation Sector Loan (Phase 2).

The loan agreements were signed by Dr. Maher Hammad Johan, Acting Deputy Minister of Finance and Masayuki Hirosawa, Chief Representative of JICA Iraq Office, in the presence of H.E. Mr. Fumio Iwai, Japanese Ambassador to Iraq.  These concessional ODA loans aim to contribute to economic and social reconstruction of Iraq by supporting the Government of Iraq and Iraqi people in efforts to reconstruct and develop further the basic infrastructures for utilization of water resources.

The first loan, Basrah Water Supply Improvement Project (II) amounting to JPY 19,415 million (approx. USD 183 million), is the second tranche loan for Basrah Water Supply Improvement Project.  The entire project is intended to develop water supply facilities and to improve quantity and quality of water supplied in Basrah city and Hartha city.

A new treatment plant with a reverse osmosis plant and transmission system, including a reservoir and a pumping station, are under construction with the finance of the first tranche, the amount of which is JPY 42,969 million (approx. USD 350 million).  The second tranche will be utilized mainly for construction of transmission lines.  After the completion, approximately 600, 000 residents and businesses in the two cities are expected to have access to clean and reliable water.

The second loan, Irrigation Sector Loan (Phase 2) amounting to JPY 15,465 million (approx. USD 146 million), aims to improve agricultural productivity by construction and rehabilitation of irrigation/drainage facilities and restoration of farmland mainly in the Tigris and Euphrates river basin.

While agriculture is the main source of employment and livelihoods for rural population in Iraq, its productivity remains low due to drought in summer seasons, aged irrigation and drainage systems, and rising salinity level of soil and water, and reduced river inflow from the upstream countries. Following the previous first phase project in similar nature assisted by JICA, this second phase project is expected to contribute to increased agricultural production, reduced soil degradation, more job opportunities, and alleviation of poverty in rural areas.

These loans are very concessional with the low interest rates and long repayment periods: the interest rate of 1% and the repayment period of 20 years including 6-year grace period for Basrah Water Supply Improvement Project (II), and the interest rate of JPY 6-month LIBOR+0.15% and the repayment period of 25 years including 7-year grace period for Irrigation Sector Loan (Phase 2).

(Source: JICA)

By John Lee.

Iraq’s Ministry of Electricity has reportedly awarded a contract to Japan’s Mitsubishi Hitachi Power Systems (MHPS) to refurbish the Unit 1 of the Hartha thermal power station (pictured) in Basra province.

According to Energy Business Review, the power station is claimed to account for approximately 25 percent of Basra’s total power generation capacity.

It’s original equipment was developed by Mitsubishi Heavy Industries (MHI).

Funding will be provided by Japanese Official Development Assistance (ODA) through the Japan International Cooperation Agency (JICA).

Mitsubishi Electric will be responsible for the generator-related work, while the Turkey’s Gama Power System will be responsible for installation and other work.

The work is scheduled to be completed in 2020.

(Source: Energy Business Review)

The World Bank has approved a US$400 million financial assistance package today to support the recovery, reconstruction and rehabilitation of priority infrastructure to restore delivery of public services in areas of Iraq newly liberated from the Islamic State of Iraq and Syria (ISIS).

The package represents an additional financing to the Iraq Emergency Operation for Development Project (US$350 million), approved back in July 2015 and already underway in seven cities in Diyala and Salah Ad-Din governorates.

The additional financing will allow the geographic scale-up of existing project activities to additional cities liberated from ISIS in the Salah Ad-Din and Diyala governorates, as well as in the governorates of Anbar (including Ramadi), Kirkuk, Ninawah (including Mosul) and the Kurdistan Regional Government’s (KRG’s) governorate of Dohuk.

Similarly, implementation responsibilities will also expand to subnational governments in addition to the central government institutions.

Saroj Kumar Jha, World Bank Mashreq Regional Director, said:

“The international community has expressed its commitment to support the urgent need for the Government-led reconstruction of Mosul and other recently liberated cities. The World Bank is committed to working with Iraqi authorities to ensure that this much-needed reconstruction takes place in a sustainable, inclusive and equitable manner to foster long term development and create opportunities for everyone.”

The current project activities span over five primary sectors: water and sanitation, electricity, health, transport and municipal services. The additional financing will continue to support these sectors, as well as address pressing education, agriculture/irrigation and urban service delivery needs of communities in liberated areas.

It will also support the restoration and preservation of key cultural heritage assets especially in the Old City of Mosul. But beyond the physical repair, emphasis will be given to improving the quality of education for boys and girls, and increasing the employment of women, youth as well as the poor in both urban and rural areas.

The additional financing will also support the Government of Iraq in attracting private sector participation in reconstruction efforts. To this effect, studies will be carried out to assess the feasibility of public private partnerships in the reconstruction, operation and maintenance of Mosul airport, which was severely damaged during the liberation of Mosul.