Al Majal Updates

On 23rd May, Al Majal Business Park (AMBP) had the pleasure of hosting the Basrah Gas Company Projects and Engineering Contractor Community Forum.

As part of our continuous efforts to contribute in the development of Iraq’s business environment, Al Majal participated in the Market Expansion to Iraq session that was held in Amman by Endeavor Jordan, the purpose of the sessions is to assist Endeavor’s portfolio and pipeline companies with expanding into different markets in Iraq.

As part of our continuous efforts to empower our young talent at Al Majal, we are happy to sponsor Mr. Aldrin Babu in the Indian National Motorcycle Racing Championship.

Al Majal’s Oil & Gas Market Roundup in Collaboration with Qamar Energy

Latest in the Iraqi & Global Energy Markets

Iraq’s economy is steadily recovering from the double whammy of the pandemic and 2020’s oil price collapse.
Iraq’s Oil Minister has called for the federal government to take over Kurdistan’s oil sector following the Federal Supreme Court’s ruling, noting that the negotiations have achieved nothing given the KRG’s “lack of flexibility.”

Key Iraq Events – Oil

In April, Iraq’s Federal government and Kurdistan region pumped a combined 4.56 Mb/d, just below 4.59 Mb/d in March.  Supply from fields under Baghdad’s control averaged 4.11 Mb/d, slightly below March’s 4.14 Mb/d, while KRG output remained steady at around 455 kb/d.
Iraq’s countrywide oil exports averaged 3.818 Mb/d in April, up by 200 kb/d from March levels and the highest since April 2020. Federal Iraqi exports averaged 3.380 Mb/d, up from 3.245 Mb/d in March, while sales from the KRG increased to 438 kb/d, from 362 kb/d in March.

Iraq’s federal government aims to establish a new oil company in the Kurdistan region, with the aim to enter into new service contracts with oil firms currently operating under the KRG. This goes in line with the Federal Supreme Court’s ruling which declared the Kurdistan region’s oil and gas sector as unconstitutional.
While Iraqi Kurdistan placed high hopes in the Sarta field, London-based Genel Energy unveiled rather disappointing results from the latest well at the oilfield.


Western sanctions are creating new challenges for Russian firms in Iraq, including making and receiving payments along with hesitancy from commercial partners. Despite the hurdles, Russia’s invasion of Ukraine has not yet caused major disruptions in Iraq’s oil sector.
China is Iraq’s top investor and Baghdad was the biggest beneficiary of Beijing’s Belt and Road Initiative last year, receiving US$ 10.5 B in financing for infrastructure projects including a power plant and an airport.

Key Iraq Events – Power

Iraq’s minister of electricity Adel Kareem said the EU has given “initial approval” for Turkey to commence exporting electricity to its southern neighbour.

Key Iraq Events – Energy Infrastructure Security

In March, Iran attacked Erbil with a dozen ballistic missiles in an unprecedented assault, which appeared to target the United States and its allies in the region.

Top Energy Deals in the Region

ADNOC to award a FEED contract to McDermott International for a massive LNG export terminal in the UAE.

OPEC forecasts 2021 world oil demand growth to remain broadly unchanged from the previous month’s assessment at 5.7 Mb/d. Meanwhile, 2022’s world oil demand is expected to increase by 3.4 mb/d, reflecting a downward revision of 0.3 Mb/d from last month’s assessment. Oil demand is projected to be slower at 2.8 Mb/d in the OECD and 1.6 Mb/d in the non-OECD. Demand is expected to be impacted by ongoing geopolitical developments in Eastern Europe in the wake of the Russian invasion of Ukraine, and now to a lesser extent by the CoVid-19 pandemic which led to re-imposed lockdowns in China.

In 2022, Middle East oil demand is forecasted to increase by 0.3 Mb/d y-o-y, with strong demand for diesel and jet fuel being the main drivers. By the end of 1Q2022, Middle East oil demand increased by 0.32 Mb/d on the back of rising demand for fuel oil and diesel in the transport and industrial sectors.

Regional Rig Count (1): OPEC+ Pressure to Keep Iraq Rig Count Low

Middle East oil drilling has still not fully recovered from the sharp drop induced by the pandemic and the related OPEC+ production cuts. However, it is likely to start expanding as quotas increase and production growth plans in the UAE and Iraq get underway.

Iraq has 46 active rigs as of April 2022, all drilling for oil. This number has not increased since the start of 2022, but is up 2 on December 2021, and 11 on April 2021. In 2019, prior to the pandemic, Iraq had 77 active rigs targeting oil.

Middle East gas drilling is starting to show a moderate recovery, supported by the beginning of Qatar’s LNG expansion projects and renewed efforts by Saudi Arabia towards its 2030 gas ambitions.

Note: Iraqi gas rigs are not reported by Baker Hughes, likely because Iraq reports gas rig figures clubbed with oil rigs and/or lack of response from contractors (drilling for non-associated gas is at minimal levels compared to oil, although it should pick up as Sinopec’s development of Mansuriyah and the Pearl Petroleum consortium’s expansion of Khor Mor, and potentially work by Halliburton at Akkas, move forward).

* End of Qamar Energy’s contribution, for more information about Qamar Energy, please

Iraq Oil Market Highlights