July 20th, 2011

Production Capacity Strategy



One of the pending issues that was talked about and questioned, and may be considered as a challenge, is the future level of Iraq’s production capacity. Conflicting statements have been issued recently by a number of governmental sources. No doubt the country has committed   itself to a major expansion program and it’s cooperating with reputable international oil companies. It’s well understood that those contracts require timely planning, not just as far as building facilities and meeting production targets, but also in terms of the investment commitment. It’s imperative to say that clarity regarding future production capacity is very much needed and of course it’s the government’s responsibility to clarify that. I believe the right answer should be derived from a thorough examination of all related factors and shouldn’t be based on personal judgment or personal opinion. After all, this is a national issue of paramount importance. The government has taken steps in that direction by setting out to draw up a long term strategy for the energy sector as a whole, entitled the Iraq National Energy Strategy. A number of production capacity scenarios of 13.5 mb/d, 9.5 mb/d and 6.0mm b/d are being studied in terms of cost, revenue and cash flow using classical profitability indicators such as IRR, NPV …etc, with risk assessment. Issues like the development of the gas industry, refining and the diversification of Iraq’s exports of oil and gas products are also assessed. This is the best tool that can be made available to the country’s leadership enabling it to take the right decision.

For Full Speech:

Thamir Ghadhban: “Iraq’s Upstream Building Blocks Of An Oil Giant”

The Forum