FLY over southern Iraq at night and you get a glimpse of the dire state of the country’s electricity. The brightest lights shine not from skyscrapers or roads, as they do in nearby Kuwait City, but from oilfields, where flares burn useless gas extracted with the crude. Iraq wastes about 12 billion cubic metres a year of gas this way—more than Austria’s entire consumption.
Yet Iraq, outside is autonomous Kurdish region, cannot guarantee its people a reliable electricity supply for a whole day. While the flaring goes on, Iraq imports gas from neighbouring Iran at high European prices and electricity from Turkish barges in the Gulf. Many Iraqis run their own generators, which account for 8% of the country’s total electricity supply and can cost a family as much as $1,000 a month—a sixth of average annual income. (…)
(The rest of the piece is here.)
I’m just back from Dubai, where I’ve done some interviewing for a piece on Iraq’s gas and electricity problems. Basra Gas Company — Shell’s big deal to gather associated gas from four of the south’s mega-projects — is causing a lot of confusion and anger. For one thing, many senior Iraqis are puzzled (polite word) about Shell’s plans eventually to export some of this gas. How? Local demand for electricity will more than account for this feedstock over the next few years. I’ve got lots more research to do and hope to be in Basra in late March. Please get in touch if you can help.
The governments of Turkey, Iraq and Iraqi Kurdistan play a dangerous game
Dec 22nd 2012 | ERBIL |From the print edition
SNAKING their way from Kirkuk, a city 240 kilometres (150 miles) north of Baghdad, through Kurdistan and across Turkey’s eastern region of Anatolia to the Mediterranean are pipes that once carried 1.6m barrels a day (b/d) of Iraqi oil to the global market and yielded fat transit fees to Turkey along the way. The infrastructure underpinned the two countries’ mutual dependence. But nowadays the balance of power has shifted. A third party, the Iraqi Kurds, has changed it. It is unclear who will emerge on top. But Iraq’s central government in Baghdad is on the defensive.
Wars, saboteurs and, since the 1990s, economic sanctions have left the Iraqi sections of the pipeline system in a mess. Barely a fraction of its capacity is used. One of the two parallel lines stands empty and the source that once fed them, the giant Kirkuk oilfield, is dilapidated. The oil ministry in Baghdad has vague ideas about revamping the pipeline, perhaps to carry crude extracted near Basra, in the far south, though this would need an expensive new pipeline to link both ends of the country. (…)
Read the rest of the piece here.
Iraqi Kurds and Western oil firms have outfoxed the government in Baghdad
Nov 3rd 2012 | from the print edition
IRAQ is blessed with abundant oil that is cheap to extract and close to newly built export terminals. Production has hit a three-decade high and continues to rise steadily. By 2035, predicts the International Energy Agency (IEA), an advocate for rich-world consumers, Iraqi output could more than double, to 8.3m barrels per day (b/d).
But Western oil firms are increasingly reluctant to play a part in this boom. ExxonMobil appears keen to sell its stake in West Qurna, one of the giant fields in southern Iraq that will provide much of the production growth. Royal Dutch Shell and BP are both still working in the south, but unhappily so. Suffocating bureaucracy and onerous contract terms make life difficult. Heavier-than-expected costs and delays to infrastructure undercut profits. (…)
Read the rest of my piece here.
Talk of conflict in the Strait of Hormuz misses the real threat to the global oil market, says Derek Brower
I’m busy. In addition to editing the ever-expanding Petroleum Economist and its excellent new channel on unconventional energy (called, imaginatively enough, PE Unconventional), I’ve four major writing projects on the go.
- A long piece for The Economist on the tar sands (or oil sands, if you prefer)
- An in-depth look, for Petroleum Economist, at Iraq’s ambitions as an oil producer
- Another take on the global gas glut, also for Petroleum Economist
- And my book on oil addiction and the decline of the West
The last of these is a weekend and weekday 5am-7am project. The early starts are the only hours I can find when my children aren’t commanding space, time, and energy. (**I’m not complaining. Frankly, they’re more interesting.**)
The usual requests: if anyone wishes to contact me about stories, you know where to find me.