The door to Iraq’s oil opens

The cynosure of Western eyes at the meeting of the Organization of Petroleum Exporting Countries, commonly known as OPEC, in Abu Dhabi, the United Arab Emirates, last December 5 was an unexpected personality – Iraqi Oil Minister Hussain al-Shahristani.
But that wasn’t a chance occurrence. By the time OPEC gathered in Vienna six weeks later, it was beyond doubt that Shahristani was on the way to becoming a celebrity in the West.

Shahristani finds himself in an enviable position as a creator of wealth for the Western world. He holds the key to the door that opens out to the magical world of Iraqi oil.
Iraq’s proven reserves of oil are only smaller than those of Saudi Arabia and Iran – and Iraq is only about 30% explored. Experts are generally of the view that Iraq’s actual oil reserves could well turn out to be at least double the 115 billion barrels of proven reserves. Beyond that, it is anybody’s guess as to the scale of Iraq’s as-yet-untapped gas reserves.

And Shahristani is visibly getting ready to negotiate the contracts for Iraq’s “super giants”. In the idiom of Big Oil, “super giants” are fields with at least five billion barrels of oil in reserve. Iraq’s super giants are Kirkuk (in Kurdistan), Majnoon (bordering Iran), Rumaila North and South (in the south), West Qurna (west of Basra) and Zubair (in the southeast) fields, and, possibly, the Nahr Umr and East Baghdad fields. In addition, Iraq is estimated to have 22 “giant” fields, each having more than 1 billion barrels of oil.

In fact, Iraq may host the largest untapped reserves in the world. There is a strong likelihood that Iraq’s reserves may turn out to be exponentially higher than the current estimations, which are based on old-style seismic surveys. All said, unsurprisingly, the world oil market is in a tizzy when Shahristani says something, anything. He is about to sign the contracts for these and many other large Iraqi oil-producing fields.

That indeed makes Shahristani a very important statesman today – at a time when worldwide oil demands are rising and consumer countries have appeared in Asia with gargantuan appetites for energy, when the oil majors’ booked reserves are in decline and the known global reserves happen to be primarily under nationalized systems.

The acuteness of the situation is apparent from the stark warning by the former chairman of the United States Foreign Relations Committee, Senator Richard Lugar, last year in a speech in New York that something like three quarters of the world’s oil reserves are located in countries which are not under American influence.

Asia Times