Ahead of the 11th edition of the Iraq Petroleum Conference in May, the CWC Group Director Nawar Abdulhadi interviews one of the key speakers of this year’s event, Mr Shawki Al-Khalisi, Head of Studies, Arab Petroleum Training Institute, OAPEC, Ministry of Oil, Federal Government of Iraq. Mr Al-Khalisi shares with us his views on the current state of the Iraqi oil and gas industry, the challenges, innovations and the outlook for the industry’s future.
Nawar Abdulhadi: Why is Iraq such an important market for the global oil and gas industry?
Shawki Al-Khalisi: Iraq is number five, globally, in conventional petroleum reserves and could rank even higher if the untapped areas are fully explored. Moreover average production cost in Iraq is one of the lowest, if not the lowest, in the world. The vast potential and the low production cost place Iraq among the most attractive areas for IOCs.
Nawar Abdulhadi: How does the Government of Iraq and the oil and gas industry work together to drive innovation?
Shawki Al-Khalisi: Iraq has embarked on an ambitious plan to raise its production capacity by signing service contracts with several, well-experienced IOCs to revive and enhance productions in a number of operating fields that were showing clear decline. The measures required to achieve this goal depend on the nature and history of each individual field which constitute a diversity of challenges. These challenges require concerted efforts by the joint Iraqi- IOCs management and call for, in some unique cases, coming up with novel ideas and new techniques that eventually lead to driving innovation in the industry.
Nawar Abdulhadi: As a refinery expert, what do you consider to be Iraq’s downstream challenges? And what could be the solutions?
Shawki Al-Khalisi: Iraq’s downstream sector has gone through dire circumstances in the previous decades and it badly needs reconstruction, modernizing and capacity building. The challenges are basically the lack of funds allocated by the central government due to budget constraints and the halfhearted resolve to address the problem. All efforts to lure investors to invest in the sector have been, with few exceptions, futile.
The solutions lie in a more serious government resolve as well as in exploring new avenues to secure investment in the sector such as revising incentives, sharing security risks collaterally, joint venture arrangements, and bilateral agreements with major Iraqi crude oil importing countries and upstream/downstream integrated contracts.
Nawar Abdulhadi: What is the role of the Arab Petroleum Training Institute in enhancing projects performance and research?
Shawki Al-Khalisi: The role of the Arab Petroleum Training Institute is basically to help in human resources development so that ranks and specialties can take part individually or collectively in the betterment of the efficiency and performance of the establishment where they work. The institute also takes part in petroleum related techno-economics studies on its own or in collaboration with others.
Iraqi and IOCs personnel are engaged in the day-to-day operations such as wells work-over, the recently introduced in Iraq, horizontal drilling and many other activities. These activities are backed by field oriented studies and research that help customize the available off-the-shelf know-how and facilitate its effective implementation for the specific requirement. They further contribute to updating the know-how and to inciting ingenuity and creativity within the working groups involved.
Nawar Abdulhadi: What is your main interest at the Iraq Petroleum 2017 Conference?
Shawki Al-Khalisi: I consider the conference as a distinguished forum for the encounter for industry specialists, investors, vendors, contractors and oil companies, both Iraqis and non-Iraqis, to meet and get acquainted with the latest activities and plans related to the petroleum industry in Iraq.
The conference is of great interest to me as it is a valuable opportunity to have a first-hand update not only on the activities of the Ministry of Oil but also on the related activities of other Ministries of the Federal Government.
Nawar Abdulhadi: What is the outlook of Iraq as a global player in the oil and gas market?
Shawki Al-Khalisi: The share of oil in the energy demand market is expected to drop in the next few decades in favor of gas and the renewables. Notwithstanding, oil consumption will rise in absolute terms as a result of the global population growth and the rise in the standard of living in most developing countries.
With its ample reserves and low production cost, Iraq can actively take part in meeting the generated extra demand with its low cost oil and strengthen its position as a major player in the oil market. Iraq also started to make strides to exploit its free gas reserves. This drive can eventually realize self-sufficiency in meeting local demand and may also allow Iraq to play a certain role in the international gas trade.
Mr Shawki Al-Khalisi will be speaking at Iraq Petroleum on 23rd May 2017 during Session 3: Iraq’s Oil & Gas Infrastructure Development Projects: Cooperation, Innovation & Investment.
About Mr Shawki Al-Khalisi
Mr Al-Khalisi is head of studies in the Arab Petroleum Training Institute of the Organization of the Arab Petroleum Exporting Countries OAPEC and a private consultant on the Iraqi oil sector. Prior to this he was a senior consultant at the Iraqi oil ministry. He has been involved in several high-profile committees, including the Iraqi oil sector strategic planning committee and the transfer of technology in the energy sector committee.
Mr Al-Khalisi has also worked in the organization of the petroleum exporting countries OPEC in Vienna, where he was involved in crude oil evaluation and refining studies.
About the Arab Petroleum Training Institute, OAPEC
APTI was established in Baghdad, Iraq, in May 1978, to prepare instructors qualified to provide training in the many technical aspects of the oil industry, and to augment the administrative and technical personnel responsible for the different fields of the industry. The other objectives of APTI include performing research and conducting studies related to the modern techniques of industrial organization, and the methodology and techniques of training and education, as well as the creation of a central information and documentation system.