Qatar seeks a 30% stake in the Total project in Iraq

According to the International Economic Group of Fars News Agency, three knowledgeable sources told Reuters that Qatar is negotiating to acquire shares of the French company Total worth $27 billion in energy projects in Iraq.

This is while Baghdad is trying to stop the withdrawal of western companies from this country. A major investment by a Gulf state is seen as a major victory for Iraqi Prime Minister Mohammad al-Sudani, who took office last October after more than a year of political turmoil.

According to a source familiar with the matter, Qatar Energy is trying to acquire around 30% stake in the project. Western companies rarely accept 100% stake in a project and prefer to participate to reduce risk.

It is said that international oil companies are trying to leave Iraq because of the poor income from the revenue sharing agreement.

In 2021, Total and Baghdad signed an agreement to carry out 4 large solar, gas, electricity and water production projects in southern Iraq for 25 years; This strengthened the hope of stopping the withdrawal of Westerners from Iraq, but ExxonMobil, Shell and BP have stopped their activities in Iraq in recent years.

But in general, this project, aimed at strengthening the Iraqi economy and reducing the country’s dependence on Iranian gas, has not yet been implemented. Total’s contract with Iraq requires an initial capital of 10 billion dollars.

Sources close to the deal told Reuters in February 2022 that the terms of the deal, which have not been made public or previously reported, have worried Iraqi politicians and are unprecedented for the country.

This contract includes the construction of a natural gas collection network to supply local power plants through the expansion of the Ratavi field, the construction of large-scale seawater treatment facilities to increase the output of other fields that use water injection, and a large solar power plant in Basra.

However, little progress has been made since then. Sources familiar with the matter told Reuters last year that a dispute over the terms of the contract threatened to cancel the project.

Iraqi Prime Minister visited Paris on Thursday and met with French President Emmanuel Macron.

One of the informed sources said that Sudani met with Patrick Pouyaneh, the Chief Executive Officer of Total Company, to end this impasse.

Qatar Energy and Total Energy are negotiating about the shares of the project but have not yet reached a final agreement.

French and Qatari energy companies are closely involved in liquefied natural gas (LNG) production as well as major energy projects around the world, including in Guyana, Namibia and South Africa.

After announcing this contract, Pouyaneh told investors that Iraq is the center of concentration of Total Energy in the Middle East and this contract is a “win-win” contract for Baghdad and this company; It is supposed to be paid to Total through the sale of oil from Retavi field, one of the oil fields of this project.

He also said that Total is looking for a partner in this project and wants to keep a 40% to 50% share.

Iraqi Prime Minister Mohammad Al-Shi’a Al-Sudani met and talked with French President Emmanuel Macron on Thursday.

According to the statement released by the Elysee Palace, the two sides discussed bilateral relations between the two countries and discussed a number of common regional and international issues.

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