Shell and Iraq sign USD 17bn deal

The long-time intention of the Iraqi governmentto use the natural gas which gets burntwhile extracting oil to provide electricity tothe local market is now becoming reality.The long-awaited signing of a USD 17bn, 25 year business deal with the UK-Dutch oilcorporation Shell was concluded at the endof November 2011. This constitutes one ofthe largest deals between Iraq and a foreignenergy concern and promises to satisfy the growing demand for electricity. The contractincludes the establishing of a new company,the South Gas Company, owned 51% byIraq, 44% by Shell and 5% byMitsubishi.Shell will provide the infrastructure to deliver the gas directly to the domesticmarket. It is believed that in the nearfuture a surplus could be generated, which could then be exported.

EU development programmes for Jordan’s economy

New guideline to protect underground water resources

The Jordan Ministry of Water and Irrigationin cooperation with the German Federal Institute of Geo-Science and NaturalResources have announced new guidelinesfor protecting Jordan’s underground waterresources from over-pumping, contaminationand violations. These guidelines areimportant for issuing new licences for corporationsand projects, which may jeopardisethe underground water resources.Jordan’s population growth and growing industry, as well as the domestic agriculturesector, has increased water demand to 1.4bn m3 in 2010; while the available supplyonly met 870m m3. 76% of Jordan’s waterneeds are procured from underground resources. The guidelines also localizeJordan’s important areas of aquifers and theframe of projects and activities, which couldbe established near them.

Kuwait supports infrastructure and housing projects

Kuwait plans to expand its housing and infrastructure sector to meet the demands of itsgrowing population. The operating companiesintend to construct various housing unitsand public buildings, such as commercial,health, educational facilities. In total, Kuwait’sPublic Authority for Housing and Welfare(PAHW) awarded contracts that are worthUSD 194m. In the area of Kuwaiti City companieswill construct 310 new housing unitsand public buildings. In the south of KuwaitCity a large schemes is envisaged whichcomprises 9,000 housing units as well as road and other infrastructure projects. To meet the need of families with lowerincomes, PAHW will build 10,000 low-costhomes in the area of Jahra. The Kuwaiti populationis estimated to increase by 63% over the next years and the therefore the need fornew housing, commercial buildings and infrastructurewill grow considerably.

IMF forecasts rise in Lebanon’s economic growth

Lebanon’s economy is going to grow by 3-4% in 2012, challenged by elevated risks. Despite the regional volatility in its neighbouringcountry Syria, Lebanon is able to targeta small fiscal surplus and keep the debt-to-GDP ratio decreasing. The IMF advised theLebanese government on the need for strongpolicies in 2012 to install confidence, as wellas the anchoring of medium-term fiscal policiesfor reducing the debt-to-GDP ratio. There is scope for revenue and expendituremeasures to create fiscal space for both areduction in the debt-to-GDP ratio and highersocial and capital spending.

Recovery of Libya’s oil production

Since the end of September 2011 the countryhas resumed its oil exports and positivenews is spreading that the oil production hasrecovered. Recently, Libya suffered frompolitical turmoil and uprisings, which temporarily paralysed the Libyan economy.Many oil companies have restarted with theexploitation. The National Oil Corporation announced thatLibya will return to the pre-war levels ofcrude-oil production of 1.6m barrels per day by the end of 2012. Until now, the productionhas increased to 600,000 bpd and it willrise up to 800,000 bpd by the end of 2011.It is one of the major challenges of theTransitional Council to rebuild the oil sector infrastructure as the major pillar of Libya’seconomy. The country is making greatefforts to repair the damages and the International Energy Agency proclaimed thatthe oil-production has resumed faster thanexpected.