Iraq's Plentiful Oil

This is interesting news, it seems that Iraq is second only to Saudi Arabia in oil reserves, and it is questionable how much oil Saudi Arabia actually has left, some analysts believe that the largest Saudi fields are already entering decline and this fact is being hidden from the world for political reasons. This could make Iraq, and whomever can pull strings in the Iraqi government, quite powerful in the world markets.



However, my perception of the tribal culture of the locals isn't what we here in the US are familiar with. I think that they are much more possessive of their land and its resources. Where we see of our land as something we buy and feel free to sell or lease to corporate interests, they seem to have a deeper sense of communal, territorial ownership. They aren't necessarily as willing as we would be to have an oil company come in and produce the fields.



I think this is particularly interesting in light of global peak oil production. As other fields are reaching their peak we get this windfall that won't be online for quite some time (much of the existing infrastructure is in disrepair and many of the fields have never been drilled). Political issues will likely make it difficult to bring this resource onstream for some time. Perhaps by the time production starts there will be enough increased awareness of the imminent global oil production peak to shift the production goals to sustainability rather than maximal production.

"Last week a Colorado energy consultancy firm, IHS, stunned some of Iraq's politicians and oil engineers by declaring that the country's oil reserves were about 215 billion barrels — about double the estimates that have held for Iraq for years. That would make Iraq a giant oil power, second only to Saudi Arabia. If the estimates prove true, Iraq's potential would outstrip its other neighbor Iran, which sits atop about 136 billion barrels of oil." (Read more)

Of course, given the source, one must take this news with a pinch of salt. Jerome says it well in this excerpt from an EnergyBulletin.net article:

Jerome a Paris, Daily Kos

I actually went to the website of IHS and found the underlying press release. It's transparently an attempt to sell their maps to oil producers seeking new oil fields. While IHS is a respected player in the industry, and is known to have one of the most extensive proprietary databases on world oil fields, it is a lot harder to gauge the reliability of this new publication. Iraq has been largely inaccessible and unexplored for most of the past 25 years, and the situation has not really changed in the past few years... While I have no doubt that IHS has been able to put its hands on data on known oil fields, I just don't see how their number for additional resources is anything other than a marketing coup based on wild-assed guesses, as they themsleves admit:

The Iraq Atlas estimate of up to another potential 100 billion barrels of oil reserves is largely based on the establishment of new play concepts in the Western Desert of Iraq, which have been generated from a recent study of the Western Arabian Platform. The Western Desert of Iraq is widely regarded as being substantially under explored with only one commercial discovery in the region largely because Iraq has had a surplus of oil to date and little incentive for exploration.

While IHS might be reporting their high-end estimate, they probably aren't too far off the mark. The oil business is big, but if news that IHS's maps were crap gout out they'd be up a creek. Thus, I expect that they are making as accurate a report as the are able, with maybe a little spin to make it juicy.