Iraq - Security still a concern for service companies

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In the last year, the pace of development in the southern Iraq oilfields has been remarkable.

Many IOCs are now establishing their main camps and service companies are busy stimulating old wells and drilling new ones. But there are still major challenges to further development of the oil sector, notably corruption, bureaucracy, and Iraq's thirty-year-old infrastructure, as well, of course, as continuing security problems and the costs of dealing with them.

April 2011 was one of the bloodiest months since the US stepped back from its visible role throughout Iraq in June 2009. Much of this violence was in the south of the country, albeit not in the province of Basra. The likely reasons for this are interlinked.

Shiite militias, though largely dormant, remain a presence in the south. With the US troop withdrawal in progress, the militias are keen to show that they have driven the US from Iraqi soil.

Iraq_security

At the same time relationships within the fragile governing coalition of Ahmed Al Maliki are becoming increasingly fractious.This may have encouraged Moqtada al Sadr, the figurehead of the main militia, to flex some military muscle. The security issue is not going to disappear anytime soon.

The fourth issue of Oil Review Middle East will include the full length feature from our correspondent in Basrah. It's essential reading for anyone wishing to do business in Iraq's oil and gas sector.

Alain Charles Publishing, University House, 11-13 Lower Grosvenor Place, London, SW1W 0EX, UK
T: +44 20 7834 7676, F: +44 20 7973 0076, W: www.alaincharles.com

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