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Minggu, 27 Januari 2008

Demand for the dollar down in daily auction

Demand for the dollar went down in the Iraqi Central Bank’s auction on Monday, the first session this week after the Army Day holiday, registering at $142.970 million compared to $181.280 million on Thursday.

"The demand hit $16.40 million in cash and $126.930 million in money transfers outside the country, all covered by the bank at a stable exchange rate of 1,215 Iraqi dinars per dollar, unchanged for the third session in a row," according to the central bank's daily bulletin which was received by the independent news agency Voices of Iraq (VOI).

The banks participating in the auction offered to sell $4.200 million, which the bank bought at an exchange rate of 1,213 Iraqi dinars per dollar.
Demand for the dollar was at a record high in the Iraqi Central Bank's auction on Thursday, reaching $181.280 million, the highest in its history.

The Iraqi Central Bank runs a daily auction from Sunday to Thursday.

Source: Voices of Iraq

Iraq opens doors to foreign oil companies to boost output

Iraq has invited foreign companies to bid in the country's first exploration and production license round since the U.S. invasion in 2003. Companies have until Jan. 31 this year to submit documents to pre-qualify to drill the world's third-largest crude oil reserves.

Iraq has an estimated 115 billion barrels of proven oil reserves, placing it behind Saudi Arabia and Iran. The country is aiming to boost production to 4 million barrels a day by 2009, but the lack of security and the government's failure to pass a federal energy law have deterred international oil companies.

Royal Dutch Shell Plc and Total SA are reportedly bidding to develop the Akkas gasfield in Anbar province, northwest of Baghdad. However, Ivanhoe Energy, frequently covered by RI (see our coverage in June, April and March of 2007), hopes to co-develop an oilfield in North Central Iraq with Japan's Inpex Corp.

Ivanhoe believes the field is suitable for its heavy-oil upgrading technology. David Martin, Executive Co-Chairman of Ivanhoe Energy, admitted that almost every oil field in Iraq contains over 1 billion barrels, and it would probably be “safe to assume” the same here.

Iraqi Oil

Iraq has potential oil reserves in excess of 215 billion barrels and proven reserves in the region of 115 billion barrels, which puts close to that of Saudi Arabia. Its exploration and development costs are amongst the lowest in the Middle East.

However, Iraq’s oil production has historically not matched its oil reserve capability, and maximum production in any one year has never exceeded 3.5 million barrels per day (bpd), despite an exploration and development history stretching over nearly eight decades.

According to the International Energy Agency, Iraq, a member of OPEC, currently produces about 2.2 bpd, with hopes of moving towards production of 4 million bpd.

Leon Daniel, Deputy Chairman of Ivanhoe Energy said, less than 20% of the potential oil properties in Iraq have been developed.

He said about 52% of the remaining oil reserves in the country were below 28 gravity, “which they consider to be heavy,” with quite a bit below 20 gravity. “They don’t have the refineries” to handle this type of oil, he added.

Robert Abboud, Independent Co-Chairman and Lead Director for Ivanhoe Energy, said the company will closely monitor the development of the new petroleum law now in Iraqi parliament.

The overall objectives of the draft petroleum law are to optimize Iraq’s oil and gas exploitation, maximize return and unite the country. The law is investment friendly, and welcomes international oil companies to work in partnership with the Iraq National Oil Company.

Abboud said “prevailing in the bidding process is critical,” but with a Japan’s largest oil & gas developer, Ivanhoe is confident the companies will be recognized as front runners.

Source: ResourceInvestor.com

Iraq seeks to "compromise" with Kuwait on the issues of debt and reparations

Said Iraqi Vice President Tariq Hashimi Wednesday that he discussed with the Kuwaiti leadership the issue of a "compromise" on the debt of Iraq's invasion and reparations for the Iraqi invasion of the country, estimated at tens of billions of dollars.

Hashemi said in an interview with reporters, "Any compromise solution satisfactory to both parties is a good, We are not dropping compensation."

He added, in this context, "Rajai presented to His Highness Prince (..) to reconsider this question and the answer is good but there Kuwaiti constitutional contexts in this regard," referring to the National Council.

Hashemi said that he had asked Kuwait to assist the possibility of reducing the amounts deducted from the proceeds of Iraqi oil for the benefit of the United Nations Compensation Fund.

Hashemi said "5% amount is too large in light of high oil prices and the state in Iraq with a very large projects in infrastructure, services and budget Iraq is not enough."

Hashemi said that agreement had been reached to set up a joint technical committee between the two countries to discuss such matters and that the Iraqi Foreign Minister Hoshyar Zebari will discuss these topics also in the course of his visit to Kuwait, which begins next Sunday.

Received government and the private sector in Kuwait, so far 11 billion dollars from Baghdad for the Iraqi invasion of the oil-rich Gulf state in 1990 from the 41.3 billion dollars approved so far to the Compensation Commission in the United Nations.

Kuwait had demanded compensation of up to 178 billion dollars and demands made to the Commission, which was formed in 1991 far the liberation of Kuwait.

Kuwaiti deputies had warned the government of the consequences of a waiver for any of these awards waved interrogate the government if what was done.

But Kuwait agreed in 2004 to an American request to reduce Iraq's debt owed to them enormously and estimated to be worth 16 billion dollars.

Senin, 24 Desember 2007

Why Iraqi Dinar

Why the New Iraqi Dinar?

In the 1990's, when Iraq was a leader in its region, every 1 Iraqi Dinar was worth an outstanding $3.20 USD (U.S. Dollar). At that exchange rate, the 25,000 New Iraqi Dinar note would have been worth $80,000.00 USD!

Since the capture of Saddam Hussein, the economy of Iraq has nearly doubled in value. In the eyes of many investors, the New Iraqi Dinar will only rise in value as well. Iraq sits upon a lake of oil, and its reserves are sufficient to feed the needs of the world for decades to come. We believe, as do many other investors, that there is great potential for this country to expand economically. We invite you to participate in this once-in-a-lifetime opportunity.

The United States Department of Treasury has a strict policy regarding the New Iraqi Dinar and is working with the Iraqi government to reinstate a strong decentralized banking system in the nation. In December 2004, six western banks were operating in Iraq, and six Iraqi banks were in operation outside the country. In March of 2005, three banks were given license to operate in Iraq: The National Bank of Kuwait, HSBC Bank, and Charter Bank of England. An estimated 33 billion dollars have already been collected for the process of reconstruction of Iraq, and companies like Coca-Cola, Chevron, Texaco, and Alabama Blount 4 Inc., are investing!

Iraqi Dinar

Astounding currency devaluation.

After years of trade sanctions, and rampant counterfeiting, the Iraqi Dinar has plummeted from its pre-Gulf War value of over USD$3, to mere fractions of one US cent. What was once the equivalent of more than $82,500, can now be purchased for less than $50. Can Iraq's economy achieve, in a free market, what it once achieved under a brutal dictatorship? We don't know yet. But we know she is not alone in her effort to do so.

Might a free Iraq thrive?

Above and beyond the vast oil reserve, agriculture, and highly educated population, there is now liberty in Iraq. We believe that where liberty is sown, prosperity blooms.

We understand that liberty is always challenged. It's challenged regularly in our own country. Why should a fledgling democracy, on the heels of a 30 year dictatorial rule, be immune?

We simply trust that the seed of freedom, implanted back in 2003 with the fall of Saddam's regime, has germinated in the hearts of the majority of the Iraqi people. We see this as a wondrous thing, with tremendous possibilities.

The free world is behind Iraq.

Thirty-eight nations have reduced the debts owed to them in an effort to bolster Iraq's economy. Billions of dollars are being invested by international firms to create Iraqi markets. 18 billion dollars has been given to Iraq by the US State Department to rebuild the nation's infrastructure. They are receiving aid monetarily, militarily or both, from most of the countries in the free world.

What if?

Let's say you decide to err on the side of Iraqi prosperity. You take advantage of the 100 year low value and buy 2 million Iraqi dinars. You look them over, admire them, and show them to some friends as a curiosity. The security features alone will have them enthralled. Then you stick them in a closet and go about your life.

A few years from now, you see a program on A&E portraying the lives of average Iraqis. You see people drinking locally bottled, genuine Pepsi Cola; not the ersatz they'd been consuming for years. They are buying their cars from Baghdad Mitsubishi.

Their highly educated engineers, no longer waiting tables or driving cabs, are engineering. The world's 2nd largest oil reserve is producing more efficiently. Higher quality crops are being harvested, in larger numbers.

You discover that things are going well enough in Iraq to have raised the value of the the dinar to one US cent.

Your $2100 purchase would now be valued at $20,000.

This is no pipe dream.

This is a genuine possibility, with remarkable ramifications. Organizations like Operation Iraqi Children working with the US military, are helping to shape a new generation of freedom loving Iraqis. It won't be long before these kids take their place in society. They will recall their childhood as a time when powerful Americans released them from the grip of a bloodthirsty madman, and gave them the tools and support to build a peaceful, prosperous society to call their own. The incredible successes of the last two Iraqi elections seem to clearly suggest that they want it, and will run with it.

Furthermore, the two pre-eminent causes of the collapse of the Saddam dinar have been removed from the equation. Trade sanctions have been lifted, and the currency's high tech security features have been thwarting counterfeiters.

So, who are we?

We are freedom loving Americans that believe a liberated, resource rich Iraq can become a force in the world economy. We believe the efforts of the coalition are noble, and will be effective.

We are not professional financial consultants or Wall Street gurus. We can't predict the future or offer any investment advice.

But we will bet on Iraq.