By Ahmed Mousa Jiyad.
Any opinions expressed are those of the authors, and do not necessarily reflect the views of Iraq Business News.
The Fifth Energy Bidding Round: Poor Management, Dubious Contracts and Bad Results – Attracted Unprecedented Opposition
Prominent Iraqi oil experts and professionals drafted and endorsed a unified position’ statement (UPS) addressed to the three Presidencies; of the Republic, of the Cabinet and of the Parliament.
The UPS provides thorough assessment of both the outcome of this bid round and related dubious two model contracts; it opposes and rejects the results and calls upon the Presidencies not to ratify any contracts relating to this bid round. The UPS, written in Arabic, was disseminated widely inside Iraq and was posted on 9 May onwards on many websites.
Most of the 31 Iraqi oil experts who issued, and their names appears in, the UPS have many decades of leading positions and extensive work experience in the petroleum sector.
For nearly ten years, this is the first time that so many well-known and respected petroleum technocrats come together to issue a unified, strong and specific statement. This in fact is a manifestation of their concern on the gravity of the danger that could undermine the national interest by these contracts and those behind them.
UPS came as a culmination of individual and collective efforts and contributions that were provoked by the fact that these contracts offer unprecedented concessions to the IOCs in post 2003 Iraq, especially when the model contracts were posted and analyzed.
In addition to been the Coordinator for UPS, I wrote a series of contributions (in Arabic) and shared them with my very extensive network of contacts as well as posting them on many websites for wider readership.
There was considerable attention to this bid round since it was first perceived by the Ministry of Oil-MoO in July last year (
http://www.iraq-businessnews.com/201...ent-contracts/ ) but the recent debate had actually impacted directly by the sequence of events pertaining to the bid round.
Much of the concerns prior to holding the bidding focused primarily on the “secrecy of the contracts”.* MoO announced on 13 April it has prepared two model contracts: The first is for the already discovered and, some, producing oilfields- Development and Production Contract (DPC); and the second is for the exploration blocks- Exploration, Development and Production Contract (EDPC).
The Ministry said it sent the two model contracts together with the Final Tender Protocol-FTP and Bidding Information to the IOCs that bought data package.
But the Ministry broke with its transparent practices, followed by the previous bid rounds, of announcing and posting the model contracts, the FTP and bidding information well ahead of the bid round. This time, it did not. And when I asked why, their answer was it is a matter of “confidentiality”.
That prompted me to not only refuting the confidentiality alibi based on comparative assessment with past practices, but also put that within the environment of secrecy and non-transparency that dominates the ministry since the last ministerial shakeup of August 2016 (see my article in Arabic ???? ???? ????? ????? ????????? ?????????? ????? ??????? ???
http://www.akhbaar.org/home/2018/4/243077.html posted on 17 April 2018)
As usual, I posted the above article to my network, including one particular list comprising the three presidencies, senior officers at the Council of Ministers, former oil ministers and most seniors at the ministry of oil. This list witnessed an exchange of lengthy emails between the DG of PCLD at the MoO, Abdul Mahdy Al-Ameedi, and I.
The bidding round finally took place on 26 April. The formal announcement by the MoO was extremely brief and just mentioned a few names of IOCs. One contact posted to me the actual bids on each “area”, by whom, who were the winners, what was the bidding parameter that was announced by the Ministry prior to each bid and other information.
Based on the communicated information it became apparent how dreadful the results were for Iraq. I, again wrote a new article analyzing the process, the legal questions regarding IOCs qualifications, the lack of competition, the outcome of the bidding, among others.
Similar to previous article I disseminated a new article highlighting how disadvantageous the outcomes are for Iraq and, thus, called for immediate and complete rejection of the bid round (???? ???????? ???????: ??????? ???? ??? ???? ??????? ???? http://www.akhbaar.org/home/2018/4/243448.html posted on 27 April 2018).
The Ministry was compelled to post the two model contracts two days after convening the bid round; and there was a further shock!
After reading the DPC model I wrote and communicated a third article specifying the main flaws of the contract, its poor text, shaky premises, wrong price equation and how it favors IOCs against Iraqi interests; it was posted on 4 May and also in Arabic (???? ??????- ???? ???? ???????? ??????? ???? ?? ??????? http://www.akhbaar.org/home/2018/5/243755.html posted on 4 May 2018)
In this last article I reiterated the call to cancel the bid round not only for its disadvantageous results but also due to extremely bad contract models. Moreover, I called the Cabinet to refute the contract for East Baghdad oilfield recently concluded with a Chinese company because this contract has similar structure to those used for this bid round.
The last two articles led to another, but more heated, exchange of emails between Al-Ameedi and I within the same list of high government officials. In this debate I requested a launching of formal investigation to be done collectively by the Independent Integrity Commission, the Parliamentary Integrity Committee, the Inspector General at the Ministry of Oil and the Federal Supreme Board of Audit. The debate was interrupted by the national election and hopefully would be resumed regardless of the election results!!!
Below is the full Arabic text of the unified position by the 31 Iraqi oil experts above mentioned and was posted on http://www.akhbaar.org/home/2018/5/243940.html

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??-*** ?????? ????? ??? ?????? ?? ?????? ????? ????? ??? ??????? ???? ????? ?????? ??????? ??? ??????? ?? ??????? ??????? ????? ?????? ????? ??? 20 ??? ?34 ????
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?????: ????? ??????? ??????? Commercial Production Rate
???? ??? ??????? ????? ?????? ??????? ?????? ?? ??????? ??????? ???? ??????? ??????? ?? ?????. ???? ?????? ??? ?? ????? ??? ??????? ????? ???? ??? ?????? ???????? ?????? 10 ??? ????? ????? ??? ???. ??? ?????? ?????? ?? ???? ?? “??????” ?? ????? ??? ??? ???????? ????? ??? ???? ???? ?????? ???? ???? ?? ???? ??? ???? ???? ??????? ????? ???.

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1-*** ?? ??? ??????? ??? ??? ????? ???? ????? ????? ??? ??? ?? ????????? ?? ???? ???? ???????? ??????? ???? ??? ??? ?????? ???? ????? ??????????? ??? ??? ??? ????????? ????? ????? ?????? ???????? ??? ?? ???? ????? ?? ?????? ???????. ??? ??? ???? ?? ???????? ??? ??? ??????? ?? ????? ?????? ??????? ??? ??? ???? ?????*????? “??? ?????????” ??? ???? ?????? ???? ????? ????? ????????? ????? ??? ???????? ?????? ????? ???? ?????.
2-*** ???? “????/??????*?????? ?? ????? ??????” ?? ???? ???? ?????? ??????? (?????? ?? ???? ??????? ?????? ??????? ???) ????? ???? ???? ?? ????????? ?????? ????? (???????)? ??? ?? ??? ?????? ??????? ??? ????? ?????? ???? ??? ???? “???? ???????” ??? ?????? ?????. ?????? ???? ??? ?????? ?????? ???????? ????? ??? ?????? ????? ?????.
3-*** ????? ???? ???? ?????? ??????? (?????? ?? ???? ??????? ?????? ??????? ???) ?? ???? ?????-??*** R-factor ????? ????? ?????? ????? ?????? ?????? ??????? ??? ???????. ?????? ??? ??????? ?? ??????? ??????? ???? ????? ??? ?????? ??? ???? ??????? ????? ?????? ???????? ????? ?? ????? ??????. ??? ??? ?? ????? ??? ?????-?? ?? ???? ??? ?????? ??? ???? ????? ????? ????? ?????? ??????? ?????? ????? ????? ??????? ????????.
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???? ??? ?? ??? ????? ???? ??????? ???? ????? ????? ?? ?????:
1-*** ?? ??? ??? ?????? ?????? ??? 20 ?25 ??? ??????? ????? ??????? ???????? ?34 ??? ??????? ????? ?????????*???????? ????????. ??? ?? ??????? ?????? ???? ??? ????? ???? ????? ??? ????? ???? ?????? ????? ?????? ???????? ??? ?????? ??? ???? ?? ???? ????? ??? ??? ??????? ????? ????? ???? ??????? ????? ?? ?? ??? ???? ?????????!!!!
2-*** ???? ????????? ??????? ??????? ????? ?? ???? ??? ????? ????? ??????? ??? ???? 2008 ?????? ????? 2018 (?? ???? 118 ???) ??? 74 ????? ???????? ?? 48 % ???? ?? ????? ??????? ?? ??? ???????!!! ?????? ????? ??? ?????????? ??????? ??? ?????? ?????
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5-*** ???? ?? ??????? ?? ??? ???????? ???? ??? ????? ??????? ???????? ????? ?????? ??? ???? ????? ????? ??? ??????? ????????? ?????? ????? ????? ?????? ????? ??? ????? ????? ??????? ???????? ??????!!??
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???? ????? ??? ?? “???? ?????? ??????” ??????? ???????? ?????? ???? 30 % ????? ???? ????? ????? ????? ?? ??? ?? 21.5 ????? ?????? ???? ?????? 70%.
???? ???? ????????? ???????:
1-*** ?? ???? ??????? ??? ?? ????? ??? ?????? ??? ??? ??? ????? ???????? ????????? ???? ????? ??????
2-*** ?? ???? ????? ????? ??? ?????? ????? ??? ????? ??????? ??? ???? 2008 ???? ????. ??? ???? ??? ??? 22.21 ????? ????? ???? ??? ??? ????? ???? 2016. ??? ?? ?????? ???????? ?? ????? ??? ????? ??????? ????? ?????? ????? ??? ????? ????? ??????????!!!
3-*** ????? ???? ???????? ?????? ????? ????? ??????? ??? ??? ??????? ????? ?????*??? ??? ??? ????? ?? ????? ?? ???? ?? ????? ?????? ??? ???? ?? ??????? ??????? ???????? ?? ?????? ????????? ???? ????? ???? 70% ?????? ???????? ??????.!!
4-*** ??????? ?? ?? ??? ?? ????? ?? ???? ????? ???? ???? ????? ?????? ?????? ??? ??????? ????? ?????????? ??????? ???? ??? ????? ?? ????? ?????-?? ??? ??? ?????.
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?????: ??????? ?? ??????? ??????? ???????? ?????? ?????? ???????
?? ????? ????????? ?????? ?? ????? ?????? ?????? ?? “????? ???? ????? ????? ???????” (?????? 112 –?????)? ??? ???? ?????? ???????? (??? 2015) ??? ” ??? ????? ?????? ?????????? ….. ?????? ??????? ?????? ???? ???????? ???????? ???? ?????? ?? ????? ?????”.
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??? ??? ????? ???? ?? ?? “???” ??? ???? ????? ?? ??????? ??????? ?????????-???????- ????? ?????? ??????? ??? 2010. ????? ???? ???? ??? ?? ??????? ?? ???? ????? ?? ??????? ??????? ?????? ???? ????? ??????? ???? ?????? ???? ??????? ?????? ??? ??? ???? ????? ?????? ?????? ??? ?????? ??????? ???????? ????? ???? ????? ????? ??????? ????? ??????? ?????? ?? ????? ???? ???? ??????? ??????? ?? ?????.

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1-???? ????? 2-???? ????????? ??????? 3-??? ?????? ??????? 4-?. ???? ???????? 5-?. ???? ???????? 6-?. ???? ??? ????? 7-???? ???? ??????? 8-?. ???? *????? ?????? 9-?. ???? ???? ???????? 10-?. ???? ???? *??????? 11-???? ??????? 12-?. ????? ????? ??? ?????? ? 13-?. ????? ??????? 14-????????? ???? ???? ?????????? 15-???? ???? 16-??? ???? ???? ?????? 17-???? ??? ???? ???????? 18-?. ???? *??? ??????? 19 -??? ???? ????? 20-???? ??????? 21-???? ???????* ?????? 22-??? ???? *??????? 23 -???? ???? ???????? *24-???? ????? ???????? 25-??? ??? ?????? ????????* 26-??? ???? ??? ??????? 27- ???? ???? ??????? 28 -?? ??? ??? ??????? 29 – ?. ???? ?????? 30-*????* ???? ???? (???? ??? ?????? ??????) .
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(???? ?????? ?????? ?????? ????? ?????????)
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8 ???? 2018
Mr Jiyad is an independent development consultant, scholar and Associate with the former Centre for Global Energy Studies (CGES), London. He was formerly a senior economist with the Iraq National Oil Company and Iraq’s Ministry of Oil, Chief Expert for the Council of Ministers, Director at the Ministry of Trade, and International Specialist with UN organizations in Uganda, Sudan and Jordan. He is now based in Norway (Email: mou-jiya(at)online.no, Skype ID: Ahmed Mousa Jiyad). Read more of Mr Jiyad’s biography here.


Source: Iraq-BusinessNews.com.

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