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Iraq mulls rekindling national oil company

BAGHDAD, March 20, 2017 – Iraq is working to re-establish the Iraq National Oil Company (INOC), Oil Minister Jabbar Al Luaibi confirmed on Monday.

In a statement on the ministry website, Al Luaibi said a draft resolution for the return of INOC had been ratified by the Iraqi cabinet and sent to Parliament. Debate on the INOC draft law got underway in March 2016.

The draft law is not without controversy. According to consultant Ahmet Mousa Jiyad, the text was a result of an “unhealthy chaotic situation” at government level and hadn’t been thought through.

According to Al Luaibi, the decision to re-establish INOC is part of the ministry drive to reorganise and restructure its operations. He added that the ministry was also working on setting up a national gas company and a national refineries company.

 

Founded in 1966, NIOC was broken up in 1987, with regional national entities now responsible for oil and gas developments at operational level.

The ministry did not elaborate on what the plans mean for regional national oil companies such as North Oil Company and Missan Oil Company, nor what it would mean for the newly established Dhi-Qar Oil Company.

The Ministry of Oil kicked off 2016 with the establishment of a fifth national oil company and the rebranding of South Oil Company (SOC), responsible for almost 80 percent of Iraq’s oil production, to Basra Oil Company. The latter would hand over four fields to the Dhi-Qar Oil Company.

There have been little to no updates regarding the SOC rebranding effort and the fate of Dhi-Qar Oil Company since the formal announcement on January 5, 2016. Evidence suggests that SOC continues to function as it always has.

The gas and refineries sectors are organised in similar fashion to the oil industry, with regional entities such as South Gas Company and Midland Refinery Company responsible for operations in their respective geographic areas.

In related news, Iraq Oil Tankers Company on Monday signalled its intention to purchase a very large crude carrier and two so-called handysize vessels with a deadweight of between 20,000 and 25,000 tonnes.

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