Iraqi Oil Minister reverses NOC decree to take ownership of state oil firms

Iraq’s Oil Minister, Jabar al-Luaibi, reversed his decision to transfer the ownership of nine state-owned oil companies from the ministry to the newly formed National Oil Company after opposition from Iraq’s Prime Minister-designate, the ministry confirmed on Saturday.

ERBIL (Kurdistan 24) – Iraq’s Oil Minister, Jabar al-Luaibi, reversed his decision to transfer the ownership of nine state-owned oil companies from the ministry to the newly formed National Oil Company after opposition from Iraq’s Prime Minister-designate, the ministry confirmed on Saturday.

In an interview with state media, Luaibi stated that Iraq hopes to produce seven million barrels of oil per day (bpd) through the National Oil Company and export four million bpd in 2019.

He reversed his decision to transfer ownership two days after issuing the decree.

The move will enable the new government of Prime Minister-designate Adil Abdul-Mahdi to make its own decisions in the oil sector, Iraq’s Oil Ministry said in a statement.

Luaibi is the current Oil Minister in the outgoing government led by Prime Minister Haider al-Abadi.

Abdul-Mahdi had reportedly been “annoyed” by the original decree which had been “made in a rush and without his approval,” a senior Iraqi oil official told Reuters. 

Luaibi had issued a decree on Thursday to transfer the ownership of nine state-owned oil companies, including oil marketer SOMO, from the Oil Ministry to the newly-formed National Oil Company, which Luaibi also heads.

The nine state-owned firms included in Luaibi’s decree, are SOMO, the Iraqi Oil Exploration Company, the Iraqi Drilling Company, the North Oil Company, the Midland Oil Company, Basra Oil Company, Dhi Qar Oil Company, Maysan Oil Company, and the Iraqi Oil Tankers Company.

On the same day, Abdul-Mahdi called on current Iraqi officials in the outgoing government cabinet to refrain from signing urgent deals, making non-essential hires, or other critical decisions.

The Iraqi federal government last week named Luaibi as head of the new National Oil Company, which is to serve as an umbrella organization for all state oil companies.

The positions of company chief and minister are not related, but Luaibi currently holds both.

In March, the Iraqi Parliament voted to establish the company, which is meant to manage the country’s upstream operations, freeing up the ministry to set plans and strategies to develop the sector.

In an interview with state TV on Saturday, the Oil Minister stated that his country hoped to export one million bpd through Jordan’s Aqaba port, without offering more details or a specific timeline.

Editing by Nadia Riva