By SAM DAGHER
BAGHDAD—Prime Minister Nouri al-Maliki said his government would tackle logistical and other obstacles facing international oil firms working in Iraq, saying his country desperately needs to boost oil revenues to meet its massive infrastructure-investment needs.
In his first interview since the Parliament confirmed his new cabinet this month, Mr. Maliki acknowledged that oil companies have been facing delays in getting necessary equipment into Iraq because of backlogs at the airport and the main border entry points in the southern oil hub of Basra.
But he said he was getting involved to resolve the issues, which oil executives have been complaining about for months.
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Mr. Maliki, whose previous government opened the way to the current spate of foreign-led, oil-field redevelopment work centered in southern Iraq, said his new government would be equally welcoming to international petroleum firms. “We have no restrictions on their entry. We want them,” Mr. Maliki said, referring to foreign oil companies and oil-services firms. “We need speed. We need money.”
While Iraq is home to one of the world’s richest deposits of oil, it has struggled to fully exploit that wealth over years of war, sanctions and underinvestment. Iraqi oil production has been stuck at some 2.5 million barrels a day, about its level before the 2003 U.S.-led invasion.
Baghdad aims to lift output to 12 million barrels a day in less than a decade, and last year, Mr. Maliki’s government green-lighted a handful of international consortia to boost output at some of the country’s biggest fields. But companies at work in the south are already complaining about big bottlenecks—including capacity limitations at a big Iraqi port near Basra, and bureaucratic red tape that slows the import of equipment and issuance of visas to staff members.
Mr. Maliki said he was meeting this week with senior security officials to tackle logistical bottlenecks and find other ways for firms to bring in equipment.
Oil sales account for more than 90% of Iraq’s revenues. Mr. Maliki said Iraq needed to plug an expected 14.3 trillion dinar (about $12.2 billion) gap in next year’s 93 trillion dinar budget. He predicted that the country’s cash-flow problems would ease by September when one of four new floating oil-export terminals currently under construction in Basra would become operational.
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Mr. Maliki said the four new terminals would handle 3.6 million barrels a day in all, more than doubling Iraq’s export capacity.
Separately, he said work would start soon on an agreement to build an oil pipeline from Northern Iraq to the Syrian port city of Baniyas. The new line would be able to pump 2.6 million barrels a day when finished.
The prime minister also said a fresh batch of proposed amendments to Iraq’s investment law would better protect foreign investors and spur interest in several sectors, including housing.
Mr. Maliki said he was determined to shield the country’s oil sector, and foreign investors, from political interference, including from partners in his own government.
Mr. Maliki cobbled together an unwieldy coalition of politicians, some of whom have been publicly skeptical of a foreign role in the oil sector. He promised to fire offending ministers. “The government will have a single message,” he said. “Whoever has a different message should leave the government and join the opposition.”
He dismissed a recent fatwa, or religious edict, by anti-American cleric Moqtada al-Sadr prohibiting his followers from working with foreign oil companies, calling the edict a “mere opinion.”
Mr. Sadr’s political movement, which did well in March parliamentary polls, played a decisive role in helping Mr. Maliki win a second term. The movement won eight ministries in Mr. Maliki’s new 45-member cabinet. “What kind of Islam prohibits this?” said Mr. Maliki. “These are not security or occupation companies,” he added. “These are oil companies that have come in accordance to open tenders and won oil contracts, and they are most welcome.”
— Hassan Hafidh in Amman, Jordan, contributed to this article.
Courtesy of the Wall Street Journal
