IRAQ - Ahmad Al-Shamma.

Undersecretary of Petroleum (deputy oil minister) since December 2004, Shamma is a prominent engineer. Until late 2004, Shamma used to be the director general of the ministry's fully-owned State Company for Oil Projects (SCOP), a huge firm which employs more than 2,000 engineers and is involved in the upstream, midstream and downstream branches of the petroleum industry. SCOP is in charge of implementing the ministry's projects and as such it has been overseeing all of them so far.

Under Bahr Ul-Uloum's first term as minister, however, the ministry in May 2004 adopted the idea of reviving the Iraq National Oil Co. (INOC) which in the 1980s was disbanded and whose functions were assumed by the ministry directly, with SCOP acting as the implementer of projects. INOC now is headed by another Undersecretary, Abdul Jabar Al-Wagga' (see below). The plan is to merge the main Iraqi national E&P companies, notably including North Oil Co. (NOC) and South Oil Co. (SOC) as well as the Iraqi Drilling Co. (IDC), SCOP, and the oil refining sector. The aim is to streamline the ministry's subsidiaries, end over-staffing and reduce costs. But there are also plans to privatise refining plants proposed when Ghadhban was the petroleum minister.

Shamma last month attended a news conference with the top management of Japan Petroleum Exploration Co. (Japex) to announce a one-year contract signed between his ministry and Japex whereby the latter will provide technical support for exploration and oilfield development. Under the deal, Japex do 3D seismic surveys in existing oilfields as well as untapped fields. Japex's President Yuji Tanahashi said his company hoped its technical support will help Iraq boost its crude oil production from less than 2.1m b/d to 4m b/d in the next five years. This was one of the SCs which the ministry awarded after approval from the SPC and on the recommendation of SCOP.

Japex and the Petroleum Ministry have formed a steering committee, which eventually will also represent INOC, to jointly conduct analytical work for data gathered through geological surveys in tapped and untapped fields in four regions: the area near Baghdad, the north-eastern part of Iraq, a western desert area along the border of Iraq and Syria, and the large Basra area of oilfields in the south. Japex will also conduct a training programme for Iraqi oil engineers for oil exploration, drilling and exploitation, Tanahashi said.

Shamma said his government would welcome the entry of Japanese corporations into Iraq's petroleum industry, saying "the agreement with Japex is only the starter for bigger and wider co-operation with Japanese companies in oil and gas". He said "exploration for hydrocarbons had almost been stopped since the mid-1980s, because of the state of war. He added: "That's why there's a lack of knowledge on the exploration side in Iraq".

The steering committee held its first meeting last month, and tentatively plans to hold the second round in July, in a bid to discuss the details of the joint study. The contract, which started on March 27, will last until March next year. But Shamma said the Iraqi Petroleum Ministry expected to renew the contract if more time is needed for the project. Tanahashi said: "Our expectation is growing that we [Japex] ill enter the Iraqi oil production business, if we make this project successful". In response, Shamma said "Japex will be in a better position in that case".

Abdul Jabar Ali Al-Wagga': Another Undersecretary (deputy minister) at the Ministry of Petroleum, Wagga' is president of NIOC which was revived earlier this year. Wagga' was in Brazil last month. On April 27, he top executives of the state-owned Petrobras on April 27 signed a protocol on behalf of his ministry for the Brazilian firm to return to Iraq as an investor in oil E&P and other business opportunities in the country.

Those who signed the agreement from Petrobras included the company's Inter-national Director Nestor Cervero. The ceremony was held at Petrobras HQ in Rio de Janeiro. Wagga' was in Brazil representing INOC at a meeting of 22 state oil firms held in Rio in the previous week. Wagga' then was quoted in the Brazilian press as saying Iraq wanted to see Petrobras investing in the country again. Petrobras had been operating in Iraq in the 1970s, when it discovered the Majnoon oilfield which now has one of Iraq's biggest reserves. Petrobas, however, left Iraq as the country's ousted former President Saddam Hussein nationalised the oil industry.

On April 25 Wagga' was quoted by the Brazilian newspaper Valor as saying Iraq could step up its oil production from less than 2.1m b/d to 2.8m b/d if the government were to succeed in reducing rebel attacks on production infrastructure and refining plants. Iraq has long targeted output at 2.8m b/d, but has made no progress towards that goal over the past year amid deteriorating infrastructure and sabotage. Currently, Iraq exports 1.5m b/d of crude oil, but has to import 270,000 b/d of fuels such as gasoline, as its battered refining capacity is directed at the production of combustion oil for electricity generation.

Wagga' was quoted by Valor as saying: "It's in our interest that Petrobras renews its interest in Iraq. We know them, and they know us".