Iraq warns foreign oil companies to reduce allocated funds for payment of dues 9/15
Iraq warns foreign oil companies to reduce the allocated funds for the payment of dues
Erbil, 15 September / Sپtیmbr (PNA) - Iraq informed the foreign companies that develop oil fields in the south of the country that they may need to reduce spending on next year's development activities due to the lack of his customized to repay those companies money because of falling crude prices.
The Iraqi Oil Ministry in a letter dated the sixth of September, sent to international oil companies and seen by Reuters news agency, "due to the lower revenues from oil sales Iraqi government greatly reduced the funds available to the Ministry of Oil."
He said the speech "will result in reductions in spending within the Ministry of oil and would also reduce the funds available to pay the costs of petroleum contractors with us."
And affected government revenue negatively fall in crude oil prices to around $ 46 a barrel from $ 115 in June, in June 2014 at a time when Iraq faces the second largest oil exporter in the Organization of Petroleum Exporting Countries (OPEC) an economic crisis caused by high spending on the military campaign waged by the militants the organization of the Islamic state.
And it operates international companies such as Royal Daچ Ba.پa and Shell, Exxon Mobil, Eni and Lukoil in the oil fields in southern Iraq under contracts whereby the service you get on a fixed-dollar fees in exchange for production.
And impose huge strains on the financial situation of Baghdad, where he earned a sharp drop in crude prices since last year from the sale of oil revenues.
The Ministry has asked oil companies to provide work programs and budgets for 2016 by the end of this month, which "should reflect the sharp decline in steel costs, services and equipment currently prevailing in the market."
The ministry said in her speech that it does not expect that this will lead to "decline in production from the levels set out in the work programs and budgets for 2015."
In March, senior Iraqi oil ministry official told Reuters that foreign companies have already proposed cuts in the budgets of millions of dollars this year.
The source told Reuters the sector in May that Ba.پa company, for example, had agreed with Baghdad to cut spending on the largest oil fields in the country Rumaila to $ 2.5 billion in 2015 from $ 3.5 billion was proposed initially.
It says foreign oil companies that are already complaining about the restrictions concerning infrastructure does not see it remember to raise Iraqi production this year or even next year after Baghdad asked for spending cuts opportunity.
And one of the executives said the oil sector "can not invest if one did not get his dues. What seems at the moment is that the production Spbdo to decline in the second half of 2016."
Said analysts at Morgan Stanley in a research note earlier this month they lowered their expectations for much of Iraq's oil production during the next five years and currently expect that Iraq's production until at least 2020, no more than that.
Analysts said "Our team is competent commodities, cut its forecast for supplies of Iraqi oil supply and is now expected to reach Iraq's oil production of about 4.2 million barrels per day on average in 2016 in accordance to a large extent with production levels in June and July. As currently expect a slight drop in Iraqi production between 2016 and 2020 compared with the previous forecast of growth of more than 500 thousand barrels per day. "
Iraq deficit may contribute to an increase in production as quickly as announced by the reduction of global supply glut pace Osar is expected to support prices.
Iraq and reduce its ambitious goals for the growth of oil production, saying it will raise production to between 5.5 million and 6 million barrels per day by 2020.