Baghdad slams oil deal between Russia’s Rosneft and Kurds

An Iraqi oil employee checks pipelines at Bai Hassan oilfield, west of Kirkuk. (AFP)
Updated 19 October 2017
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Baghdad slams oil deal between Russia’s Rosneft and Kurds

BAGHDAD: The Iraqi Oil Ministry reacted angrily on Thursday after Russian energy giant Rosneft signed a production sharing deal with the authorities in the autonomous Kurdish region without its approval.
The agreement came hot on the heels of Baghdad’s recapture from Kurdish forces of five oil fields in disputed territory outside the autonomous region in retaliation for an independence vote last month.
“This department and the Iraqi federal government are the only two bodies with whom agreements should be reached for the development and investments in the energy sector,” the ministry said in a statement, without mentioning Rosneft by name.
Oil Minister Jabbar Al-Luaybi condemned the “irresponsible announcements coming from certain officials in Iraq or abroad, or from foreign companies about their intention to conclude deals with parties in Iraq without the federal government being aware.”
“The federal government and the Oil Ministry are the only bodies responsible for developing oil and gas strategy and authorized to sign agreements with foreign countries and companies,” he said.
Rosneft announced on Wednesday it had signed production-sharing agreements for five oil blocks in Iraqi Kurdistan.
The state-controlled giant said it would pay up to $400 million (340 million euros) for 80 percent in the venture as part of the deal with the Kurdistan Regional Government (KRG), although up to half the sum could be paid in crude from the blocks.
Rosneft boss Igor Sechin on Thursday insisted that the company strictly followed the law and said that “if there are problems between the government of Iraq and Kurdistan then they need to solve the problems themselves.”
“I am not a politician, my job is to produce oil,” Sechin, a top ally of President Vladimir Putin, was quoted as saying by Russian news agencies.
A joint exploration program and pilot production is to start next year. If successful, Rosneft said it would start full-field development of the blocks in 2021.
Recoverable oil reserves at the five blocks are around 670 million barrels, Rosneft said, calling the estimate “conservative.”
Rosneft and Iraqi Kurdistan are already cooperating on crude purchases and sales, but the new deal “will allow us to talk about full-fledged entry of the company in one of the most promising regions” of the developing global energy market, Rosneft said.
Meanwhile, Falah Mustafa Bakir, head of the KRG department of foreign relations, told broadcaster CNN in an interview that the KRG never intended to engage in a war with the Iraqi Army.
‭ There is a need for dialogue between KRG and Iraq so as to reach a common understanding, Bakir said, according to a transcript of the interview published on KRG’s website, adding the dispute was not about oil or the national flag but about the future of two nations.
The KRG said it welcomed Iraqi Prime Minister Haider Al-Abadi’s call for talks to resolve the crisis, Irbil-based Rudaw TV said.
Al-Abadi called for dialogue on Tuesday, saying he considered last month’s referendum “a thing of the past.”


India names Modi demonetization backer as cenbank head

Visitors are seen standing next to a logo of the Reserve Bank of India (RBI) at the bank's head office in Mumbai on December 5, 2018. (AFP)
Updated 12 December 2018
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India names Modi demonetization backer as cenbank head

  • Das — a high-profile backer of Modi’s controversial 2016 move to scrap high-value currency notes, known as demonetization

MUMBAI: Ex-finance ministry official Shaktikanta Das took charge of the Reserve Bank of India on Tuesday, in a swift appointment expected to ease a dispute with the government as it pushes for looser credit rules ahead of a general election.
The announcement by Prime Minister Narendra Modi’s administration came just a day after Urjit Patel resigned from the post, following months of clashes between the two institutions over lending curbs and how to deploy the central bank’s surplus reserves.
Pressure on the RBI to take immediate steps to boost the economy, including a transfer of the excess reserves to the government, could well rise after Modi’s ruling Bharatiya Janata Party (BJP) suffered likely election losses in three key states on Tuesday.
Das — a high-profile backer of Modi’s controversial 2016 move to scrap high-value currency notes, known as demonetization — will serve a three-year term as governor, effective immediately.
RBI watchers said they expected the 61-year-old, who retired last year as secretary of the department of economic affairs having previously served on the RBI’s board, to put relations between the Mumbai-based bank and the finance ministry in New Delhi on a stabler footing.
Investors will also look closely at his ability to hold up against outside influences after recent efforts by the Modi government to gain greater control over the central bank’s regulatory powers.
“The incoming governor will have to work hard to prove that he has his own independent mind,” said Deepak Jasani, head of retail research at Hdfc Securities.
Investors said any openly political appointee with little macro-economic experience, would not sit well with financial markets that already sold off following the BJP’s election setbacks.
But Ashish Vaidya, executive director and head of trading at DBS Bank in Mumbai, said he expected India’s debt and currency markets to react positively.
“He is a bureaucrat...We expect the RBI to take a pragmatic approach under him, be pro-growth and change its stance going ahead given that inflation has come off sharply,” he said.
Finance Minister Arun Jaitley told Reuters partner ANI that the government acknowledged the bank’s independence.
“Government will fully support the RBI and coordinate with it in areas where consultations of government are required to make sure India’s economy benefits from both government policy decisions and areas which fall within domain of the RBI,” ANI tweeted, quoting Jaitley.

SWIFT APPOINTMENT
Pronab Sen, India’s former chief statistician, said he was surprised by the speed of Das’s appointment.
“If you have a situation where a position as important as the governor of the RBI is filled within 24 hours of the resignation of the incumbent, that will raise eyebrows,” Sen told Reuters.
“People are going to say, clearly this guy had already been identified. And, the situation was created where Urjit Patel had to quit.”
Das — widely seen as a contender for the top RBI job after Raghuram Rajan’s term ended in 2016 — did not answer calls from Reuters to his mobile phone.
RBI officials who have worked with him closely said Das was likely to be more inclusive in the decision-making process than Patel.
“He has a balanced approach and is good at consensus building,” said a former deputy governor. .”..We have had our fair share of differences. But he has always been solution-centric rather than festering on those differences.”
Das worked in the finance ministry under both Modi’s government and the previous coalition led by the main opposition Congress party and was also involved in drafting the Insolvency and Bankruptcy code aimed at protecting small investors.
He came under fire for his pro-demonetization stance and was the most vocal bureaucrat at the time Modi withdrew the high-value bank notes to fight tax evasion.
Das last year criticized the methodology of global rating agencies and sought a sovereign rating upgrade for India.