Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Iraq is pumping crude at record levels and the violent street protests that engulfed the oil-rich south have not affected energy facilities in OPEC’s No. 2 producer.
The country’s crude exports reached a record of 3.59 million barrels a day, Oil Minister Jabbar al-Luaibi said after a meeting with representatives of foreign oil companies working in Iraq. Iraq is producing crude at a level of about 4.36 million barrels a day, as agreed with limits set by OPEC, and has a capacity to pump about 4.75 million barrels, without the semi-autonomous Kurdish region in the north, he said.
“Security forces in Basra took measures to protect oil fields and foreign employees,” al-Luaibi told reporters in Baghdad. “Our message was clear and strong to oil majors that Iraq is safe and what is happening in Basra was a passing cloud that passed peacefully.”
Iraq boosted protection in the south after protesters demanding jobs and basic services torched government buildings and the Iranian consulate in the southern city of Basra. A number of them briefly forced their way into a water intake facility that supplies an oil field operated by Lukoil PJSC on Saturday. Iraq has been working to raise crude production quickly, amid investment constraints and hold-ups that have seen Royal Dutch Shell Plc exit one of the country’s biggest oil projects.
The security situation in the south is improving and energy installations were not affected by the protests, al-Luaibi said. Eni SpA Chief Executive Officer Claudio Descalzi and al-Luaibi discussed an additional increase in the production of the Zubair oil field in southern Iraq, the Italian company said in a statement on Sunday.
Refinery Restart
The Organization of Petroleum Exporting Countries and its allies agreed in June to increase oil production, with Saudi Arabia and Russia saying about 1 million barrels a day will be added to the market. But they didn’t detail how the production increase would be split between OPEC and non-OPEC nations. A committee of OPEC and its allies is scheduled to meet in Algeria later this month to discuss allocations.
Iraq restarted the Salahuddin-2 unit of the Baiji oil refinery, north of Baghdad, on Sunday, al-Luaibi said. The unit is currently processing 70,000 barrels a day, he said. Baiji was damaged in fighting with Islamic State militants. The government, which declared all regions free from the militant group last year after fighting that erupted in 2014, has ambitious goals to end its reliance on refined-fuel imports. Baiji’s last unit, North, needs about a year to be repaired, he said.
The country’s refining capacity is currently at more than 700,000 barrels a day following the Salahuddin-2 unit restart, Deputy Oil Minister Fayyad Al-Nima told Bloomberg at same news conference in Baghdad. Refining capacity is due to reach 800,000 barrels a day after the Salahuddin-1 unit in Baiji restarts at the end of the year or early next year, he said.
(Reporting by Khalid Al-Ansary).
