Market Analysis

Iraq, as well as Ukraine, lives in anticipation of the elections to be held in January 2010, foreign companies run a great risk by entering into an agreement to develop oil fields in Iraq, because they may be revised.

Despite failed attempts to restore our country's economic position in Iraq that Saddam Hussein had been a fairly weighty at the diplomatic level, the work in this direction continues. In reference materials trade and economic mission of the Ukrainian Embassy in Iraq (a copy is available) said: The Iraqi authorities have decided on the foreign oil companies, which will continue to participate in tenders for mining and oil extraction. But because of the contradictions between the authorities of Iraq and Kurdistan in the north of the country signed the oil agreement, contrary to official views of Baghdad.

Oil companies that intend to invest the billions required to take into account the big risks on these contracts. The new government at least change the terms of the agreements will not be happy that oil companies - said the head of the Iraqi parliamentary committee on oil and gas, Ali Hussein Balo .

the list of potential candidates for the Iraqi oil is not of Ukrainian companies, but in the long term they may appear. Obviously, the new president of Ukraine, which should come into office in February next year, has a chance to intensify negotiations with the Iraqi authorities to secure lucrative contracts for Ukrainian companies. Prerequisites for these talks were created a year ago, when initiated by our Ministry of Economy of Kiev delegation visited Iraq, which along with businessmen attended by a representative of the Secretariat President Azad Mohammed Ahmed (total - nine men).

As reported by EI, the Iraqis offered to increase cooperation in the framework of Oil for food, the main actors which are traditionally the Turkish and Jordanian businessmen. Away from the Middle East expressed their willingness to supply oil to Ukraine under the condition that the territory of our country's oil will be used at the refinery, which will ensure its downstream processing.

In addition, Iraq is interested in joint activities with Ukraine in the agricultural sector, in construction, industry, supplies of Ukrainian wheat, sunflower oil, feed for poultry. However, the current political situation in Iraq, and Ukraine does not have to conduct efficient and mutually beneficial negotiations.

Earlier

desire to work with the Iraqi oil companies have expressed Ukrnafta and Ukrtatnafta. Suffice it seemed plausible alternative supplies of Iraqi oil to the Odessa oil refinery, controlled Russia's Lukoil, which is participating in tenders to develop Iraqi oil fields.

One of the options under consideration supplies, as shared with one of the market participants, was this: the Iraqi oil loaded into tankers at the Turkish port of Ceyhan, and is delivered in neftegavan Odessa Sea port, where is reversible pipeline for processing at the Odessa refinery. These oils may subsequently be implemented in France and Italy. And after running an oil pipeline Odessa - Brody pipeline towards Europe and the completion of its on Polish territory proposed to consider also the option of direct transportation of Iraqi oil to the EU.

But

oil - not only economic interest of Ukrainian companies in Iraq. They have attempted to obtain contracts for the reconstruction of the country, the development of its infrastructure, the creation of the security forces. The first significant contract was signed in May 2004, then on the website of the Ministry of Defense has reported that the company Anham received a contract worth $ 120.1 million for equipping the Iraqi army - 15 battalions and six brigades.

Moreover, the company developed their own only 7% of the order, while the Ukrainian companies will carry 65% of the contract price (about $ 78 million). Partners from the Ukrainian side's daughter made the state company Ukrspetsexport - State Enterprise Specialized Foreign Trade Firm Progress. In addition, Ukraine was implementing to 2006, two-year contract to supply the Iraqi army for 2thousand trucks KRAZ adapted for operational and climatic conditions of this Middle East countries.

order for Ukrainian companies to expand its presence in the Iraqi market, they need not only an effective state aid, according to experts, but also good relations with the Ukrainian authorities to the Iraqi government and its Western partners.

history of relations

official position of Kiev on Iraq was revised in early 2003 until this time, Ukraine has consistently opposed the use of force in resolving the Iraqi crisis. However, the situation developed in such a way that U.S. military operations become inevitable. Ukraine risked stay away from the real processes taking place in Iraq. And Kiev chose a pragmatic way to ensure their own interests: it was decided to send a Ukrainian military contingent - Fifth mechanized brigade - in Iraq. Later she was joined by most of the 19 th Battalion NBC, which was stationed in Kuwait.

Iraqi province of Wasit became the base for the Ukrainian peacekeepers. Since August 2003, the Ukrainian contingent in the province has initiated and implemented projects totaling more than $ 10 million These projects consisted in the reconstruction of infrastructure systems. In early March 2004, our Cabinet has established an Inter-Ministerial group to ensure Ukraine's interests in Iraq (the advisory body, which aims to promote bilateral cooperation with Iraq, including at the level of business).

Svetlana Dolinchuk

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