Thread: Iraq/Dinar News Up until April 5th 5PM CTZ.

Satterfield: Iraq oil law will pass

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29 March 2007 (United Press International)

The Bush administration remains optimistic Iraq will approve a law governing its oil and natural gas despite growing opposition.

Ambassador David Satterfield, senior adviser to U.S. Secretary of State Condoleezza Rice and the State Department's Iraq coordinator, said a deal reached last month on the framework for the draft hydrocarbons law meets two of three points necessary for the military "surge" to be successful.

The added troops "cannot by and of itself achieve lasting security for Baghdad or Iraq as a whole," Satterfield said Tuesday at a forum at the Washington Institute for Near East Policy.

He said it needs to be coupled with political reconciliation, economic development and diplomatic engagement.

Kurdish and federal government negotiators ended nearly a year of deadlock and agreed in part to the law, which will govern Iraq's oil and determine revenue sharing. Not all the details have been worked out, something necessary before Parliament takes up the measure.

The law won't affect current production, which is struggling amid war, sabotage and attacks, shortages of electricity and historic degradation after years of sanctions and misuse by Saddam Hussein.

It will set the framework for investments in Iraq's oil, which at 115 billion barrels of proven reserves is the third-most in the world.

The Iraqi Accordance Front and the Iraqi National Slate, led by former Prime Minister Iyad Allawi, have come out against the law.

So has the Iraqi Federation of Oil Unions, which can shut down most of Iraq's 2 million barrels per day production if it wanted to.

This could spoil any progress the Bush administration has pointed to as one of the benchmarks for continuing the support for the current Iraqi government.

"I believe that this is a benchmark that will be met. It will be met at the timeframe which I think will be defined in terms of weeks and months and not longer period," Satterfield said.

Energy - Oil & Gas

Meesan oil field's produce 130,000 bpd

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Baghdad, 29 March 2007 (Al-Sabaah)

Total production of Meesan oil fields has reached to 120-130 thousand barrels per day.

Director of Meesan oil fields committee said in press statements after discussing the new structure of Meesan Oil Company which has been established by ministry of oil "we seek raising production to high levels particularly after investing in digging 50 new oil wells in oil sites in the province.

This company establishment will contribute in raising production power of crude oil.

New policy at Central Bank auction to sell more dollars
By Dergham Mohammed Ali

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Baghdad, 29 March 2007 (Voices of Iraq)

Iraqi Central Bank initiated a new policy to sell more dollars and obtain dinars to cover items from the national budget, which is in Iraqi dinars for the first time since 2003, sending demand for dollar higher in Thursday's auction.

Demand for the dollar increased in the Iraqi Central Bank’s daily auction on Thursday, reaching $90.030 million compared with $33.045 million on Wednesday.

In its daily statement the bank said it had covered all bids, which included $10.630 million in cash and $79.400 million in foreign transfers, at an exchange rate of 1,273 dinars per dollar, unchanged since yesterday.

Fourteen banks participated in Thursday's auction and offered to sell $25 million. The Iraqi Central Bank bought the entire amount at 1,271 per Iraqi dinar.

Ali al-Yasseri, a trader at the auction, told VOI "the hike in demand for the dollar in today's session was partly due to the high foreign transfers by governmental departments and partly because of a new policy to encourage the sale of more dollars and to obtain dinars to cover items from the Iraqi national budget, announced this year in dinars."

The Iraqi Central Bank runs a daily auction from Sunday to Thursday.

Sebastian River Holding's, Inc., purchases 100 million Iraqi dinars; Company says chance of dinar equaling dollar 'feasible'

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29 March 2007 (PortAl Iraq)

Sebastian River Holding's, Inc., today announced that the company has joined the United States and has invested in the Iraqi economy by purchasing 100,000,000 Iraqi dinars.

The company feels that the investment will increase dramatically in the near future. As of today, 1,000,000 Iraqi dinars is equal to $784.93, according to the Central Bank of Iraq (CBI). Since it is nearly impossible to purchase directly from CBI, 1,000,000 Iraqi dinars is being sold as high as $1,340 in the United States, according to the company.

Prior to war with Iraq, the Iraqi dinar was valued as high as $3.20 per dinar; this means 1,000,000 dinars was worth as high as $3,200,000, the company explained in its announcement.

"We are on our way to become large investors in foreign currency," Sebastian River Holding's, Inc., President and CEO Daniel Duffy said. "Since Iraq has the largest natural gas reserve in the world and is the second largest proven oil reserves in the world with over 100,000,000,000 barrels of oil, the company feels that the dinar reaching one dinar per U.S. dollar is feasible. If the rate goes one dinar for one U.S. dollar, this would give Sebastian River Holding's, Inc., a profit of well over $99,000,000 from this one investment."

IMF is not putting pressure on monetary policy

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29 March 2007 (Iraq Directory)

Iraqi Central Bank governor, Sinan Shabibi, denied that the strict monetary policy, pursued by the Central Bank, being a result of pressure by the International Monetary Fund; he pointed out that the policy falls within the framework of the Central’s monetary reforms currently taking place in Iraq.

Shabibi explained that the strict policy of the Central was adopted as a result of the hard conditions experienced by the Iraqi economy, and the hyper-inflation which is causing substantial damage to the monetary economy that is affectin the value of the contracts; this has negatively affected the estimates related to the budget. He pointed out that the policy of “the Central” aimed at achieving price stability by using its monetary tools, like raising the dinar exchange rate against foreign currencies and increasing interest rates, that would lead to a reasonable indicators of inflation which has become a threat to the country's economy and development.

Shabibi linked the success of this policy to the stability extent of the consumer price through liquidity management.

He praised the State budget of the current year, in terms of its allocations, disbursement and its dimensions of development and investment; at the same time, he warned of the economic imbalances that will accompany the spending of the budget.

Shabibi emphasized the need for a mechanism to monitor the implementation of the budget, particularly its investment side, pointing out to the need for the ministries to abide by the financial ceiling allotted to them in the budget. In the area of economic reforms, Shabibi called to activate the productive sectors and increase their growth rates, to meet local market demand, provided that it does not result in an imbalance in the economy.

Banks and joint-stock companies activity, increasing

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28 March 2007 (Iraq Directory)

Banks and joint-stock companies activity were expected to increase in light of the appropriate climate, which has gradually evolved to support investment trends, stimulate the economy and provide some support to the private sector. Al-Khaleej Bank has issued a statement on its financial position and results of its work for 2006, achieving book profits of one billion and 637 million dinars before tax deductions, reserves and allocations; noted that the bank's capital is 22 billion dinars, while the company of Al-Karkh touristic City Games called on its shareholders to attend the annual meeting on April 16 at the company’s headquarter to discuss the agenda of making developments.

On the other side, the Iraqi company for producing and marketing agricultural products started distributing the profits of 2005, up by 25%, while Babylon Hotel called its shareholders to attend the exceptional meeting on the 8th of next April for the purpose of discussing capital increase, in accordance with article 55 / II (capitalization); also, the company of transferring petroleum products called its shareholders to attend the annual meeting on April 3 to discuss several issues relating to the functioning of the company and future developments.

Iraq eyes future tourism

By Rick Jervis, USA TODAY
BAGHDAD — Thinking about Spring Break in Iraq?
Odds are, probably not. But an exhibition organized this past week by Iraq's Tourism Ministry sought to lay the groundwork for one fine day in the future when intrepid tourists might just consider taking a vacation here.

At the "Spring Fair," held at a hotel within the concrete blast walls of Baghdad's Green Zone, visitors were treated to displays of silk rugs, antique pistols, daggers decorated with gems, and other locally made arts and crafts. The hallways were lined with photos of Iraqi holy sites.


INDEX: Life in Iraq
"If you visit these places, you'll feel how powerful and important they are. It's spiritual, like visiting the Vatican," said Abdul Zahra al-Talkami, a tourism ministry spokesman.

"Hopefully," he added with a smile, "one day you'll be able to reach them."

After the U.S.-led invasion in 2003, tourism from Western countries fell to virtually zero, al-Talkami said.

Iraq still receives roughly 350,000 religious tourists and pilgrims a year who come to visit some of Islam's holiest sites, such as the Shiite shrines of the Imam Hussein in Karbala and Imam Ali in Najaf. Unlike other tourists, religious visitors are not deterred by the prospect of car bombs and shootings, al-Talkami said.

"They're looking for martyrdom," he said. "So they don't care about the risks."

For now, the Tourism Ministry harbors no delusions about luring luxury travelers. So the primary aim of the fair, the second of its kind held in Iraq, was to inspire donations so archaeologists can resume excavations on historical sites. Many such projects came to a halt after the war began, al-Talkami said.

On one wall, photographs showed ruined archaeological sites, bombed-out mosques and U.S. military Humvees parked next to tourist sites such as the Ishtar Gate in Babylon.

"Dear guests: Sorry to hurt your feelings," a sign next to the photos reads. "This is part of our bitter reality that our culture has endured."

For Nasir al-Naqash, the fair was a chance to display his wood carvings to a wider audience.

One piece, titled "Abortion," shows a three-eyed mutant emerging from a ripped hole in the outline of Iraq. The mutant symbolizes terrorism, which Iraqis are trying to push out, the artist said. He finished the piece just as a car bomb exploded near his Baghdad workshop.

"Iraqi artists are under a lot of pressure, a lot of suffering," al-Naqash said. "Hopefully, this fair is a steppingstone to international shows."

Analysis: Iraq oil union has storied past
Posted on : 2007-03-29 | Author : Energy Analysis Editor
News Category : Energy


By BEN LANDO Hassan Jumaa Awad wants Iraq's oil to stay under state control, and the unionists, who have long worked the rigs, to be supported in developing the national resource. But this is no request from the president of the Iraqi Federation of Oil Unions.

It's a demand.

"Since we are working to make progress in production, we need a real participation in all the laws that are related to the oil policy," Awad told United Press International, speaking on his mobile phone from the southern port city of Basra. "We are the sons of this sector and we have the management and technical capability and we have the knowledge on all the oil fields." The IFOU represents more than 26,000 workers organized under various unions in the oil-rich southern and northern areas of Iraq. Shiites, Sunnis and Kurds, together they have operated Iraq's oil sector before, during and after Saddam Hussein. Their rights to officially unionize are still denied under a 1978 Saddam law, one of a few of the former president's laws the U.S. occupation and the Iraqi Parliament upheld.

Iraq's oil production is still around 2 million barrels per day, down from the 2.6 million bpd before the war, but far below its potential since most of its 115 billion barrels of reserves are untapped. Investment in the world's third-largest oil market is hampered by conditions past and present, and an unknown future.

Saddam pushed certain oilfields too hard while neglecting maintenance and new technologies. The sector was hit with war starting in 2003, and now regular sabotage and a shortage of electricity.

Kurdish and central government negotiators reached a deal last month on the framework for a law governing Iraq's oil. Details on ownership rights and revenue sharing are still far from finalized. The Iraq National Oil Co. would restart but compete with foreign oil companies, who could win contracts giving them partial ownership of the respective fields.

INOC "should have full privileges," Awad said, "and we don't agree on the production partnership." Iraq's oil has been nationalized for four decades. Iraqis view it with a pride of ownership, something the law would reduce if the contract language allowing for foreign ownership stands.

"We think that to reserve sovereignty of Iraq is to be able to control the oil wealth," Awad said, and foreign investment should be limited to technical assistance. "I wish if the foreign companies were to come into Iraq, that they help us," Awad said. "Not to suck the blood of the Iraqi people." The unions were kept in the dark, as were most members of Iraq's parliament, until the draft law was leaked to the media. Even then it was still out the reach of most of Iraq's citizens.

"The discussion over the oil law was held very tightly between the Bush administration and key representatives of the most influential parts of Iraq's decision making authority," said Antonia Juhasz, an analyst with Oil Change International and author of "The Bush Agenda: Invading the World, One Economy at a Time." "They are one of the only groups of concerned citizens in Iraq who's had real access to information about the oil law," Juhasz said of the IFOU. "They are able to represent opposition in a way that just isn't possible for a vast majority, almost of all of regular Iraqis." Oil unions led large strikes in the 1940s and 1950s. In the past four years, Iraqi oil workers stopped work when they weren't being paid or when a foreign subcontractor was hired to replace them. They only threatened to strike after the Coalition Provisional Authority ordered wages decreased. The Iraq Oil Ministry balked. This prompted other unions, like dock workers in Umm Qasr and Zubair, to edge out foreign corporations given contracts.

The IFOU could shut down Iraq's production if the draft hydrocarbons law stands. With oil revenue funding 93 percent of the federal budget, that's a large bargaining chip.

Oil workers could also whip up a critical mass of dissent in their communities.

"For the time being, people are busy with their day-to-day lives and security," said Mohamed Zine, regional manger of Middle East at the global energy analyst IHS. "I think it's easy in Iraq if you say that foreign companies are stealing Iraqi oil, this message is easy to spread." The oil workers' popular support crosses sectarian lines.

Greg Muttitt of the London-based social and environmental justice group Platform said sectarian conflict seen in Baghdad politics and violence throughout the country was absent from a December meeting of unionists in Amman, Jordan.

"There were Kurds, Sunni Arabs and Shiite Arabs present. The central versus regional issue barely came up," Muttitt said. "Yet all agreed in their strong opposition to privatization and production sharing. "The central versus regional discussion has been most prominent because the debate so far has only taken place between the political elites, which are sectarianized," he said. "I don't think that's at all representative of how ordinary Iraqis think." Awad points to the aftermath of the invasion, when production dropped to nearly nothing and the oil workers went right back to their black gold trenches.

"Sectarian strife was never an issue that the workers knew, or know in the current situation," Awad said. "They work. They produce. They don't pay attention to violence or sectarianism." (Hiba Dawood in New York and Adil Matloob in London contributed to this story.)

Iraqi foreign minister says no 'illegal occupation' in Iraq
Posted on : 2007-03-29 | Author : DPA
News Category : Middle East


Riyadh - Iraqi Foreign Minister Hoshayr Zebari on Thursday rejected remarks by Saudi Arabia that the US occupation of Iraq was illegal. "We don't think there is an illegal occupation because these forces are present and working according to international resolutions, and are accepted by a representative elected Iraqi government," Zebari said on the sidelines of the Arab summit being held in Riyadh.

The minister added that he does not support a pullout of the US- led multi-national forces.

His remarks came in response to an earlier statement by Saudi King Abdullah Bin Abdel-Aziz who rejected the US presence.

"In our beloved Iraq, blood is spilled between brothers, under the shadow of a foreign illegal occupation," the Saudi monarch said during the opening session of the Arab League Summit on Wednesday.

Zebari also said that he was hopeful that there would be another Iraq reconciliation meeting at the end of April, either in Baghdad, Cairo or Istanbul. The last international meeting held in Baghdad was deemed "fruitful" and important, Zebari said, because it featured the presence of Syrian, Iranian and US delegations

Originally Posted by goldraker

THE MOF WILL NOW HAVE TO BUY 260 BILLION DINARS A DAY!

THE WRITING IS ALL OVER THE WALL!

Good point goldraker! Yes indeed did they just tip their hand here???