IRAQ: Iraqi tribes hope Russian oil giant Lukoil will offer them jobs and a better standard of living, as the company's new facility nears completion

Record ID: 344361

  • Title: IRAQ: Iraqi tribes hope Russian oil giant Lukoil will offer them jobs and a better standard of living, as the company's new facility nears completion
  • Date: 31st October 2013
  • Summary: BASRA, IRAQ (OCTOBER 26, 2013) (REUTERS) EXTERIOR OF MALAWI PASHA HOTEL SECURITY MANAGER OF SOUTH OIL COMPANY (SOC) IBRAHIM AL-MALIKI IN MEETING (SOUNDBITE) (Arabic) SECURITY MANAGER OF SOUTH OIL COMPANY (SOC), IBRAHIM AL-MALIKI, SAYING: "A number of projects have been implemented. Lukoil has done a better job than the other foreign oil companies when it comes to social development projects and it is still implementing projects. It has an annual programme agreed with the local government." AL-MALIKI BEING INTERVIEWED (SOUNDBITE) (Arabic) SECURITY MANAGER OF SOUTH OIL COMPANY (SOC), IBRAHIM AL-MALIKI, SAYING: "Most of the Sheikhs, and especially those of the Imara tribe, were against demonstrations and they have supported Lukoil to continue its work. And now there is an improvement, there is an improvement in the economic situation in most of the surrounding areas." AL-MDAYNA, NORTH BASRA, IRAQ (OCTOBER 26, 2013) (REUTERS) EXTERIOR OF CAFE YOUNG PEOPLE PLAYING BILLIARDS INSIDE CAFE (SOUNDNBITE) (Arabic) 26-YEAR-OLD BLACKSMITH, HATEM KAREEM, SAYING: "Jobs are scarce. They employ five to six people from each tribe. They are hiring people on contracts and not permanent jobs. The contracts are for four or five months and after that, they fire them. I did not get a job, but people who did had to pay 5,000 to 10,000 dollars (in bribes)." YOUNG PEOPLE PLAYING BILLIARDS (SOUNDNBITE) (Arabic) 26-YEAR-OLD BLACKSMITH, HATEM KAREEM, SAYING: "I feel said because Iraq exports two-and-a-half million barrels of oil a day and I'm poor and my living conditions are bad. We do not have a comfortable life and no entertainment facilities to relax." YOUNG PEOPLE PLAYING BILLIARDS
  • Embargoed: 15th November 2013 12:00
  • Keywords:
  • Location: Iraq
  • Country: Iraq
  • Topics: Business,Economy,Politics,Energy
  • Reuters ID: LVA7QLQPDE0B3FJ192KUMVFLRISZ
  • Story Text: Sheikh Qahtan Hamid al-Imara, leader of the Imara tribe, clutches his prayer beads and watches a huge new oil facility nearing completion across the road from his village, hoping that Russian operator Lukoil will offer his poor tribesmen a better way of life.
    After struggling for decades from sanctions and wars, most recently the U.S.-led invasion from 2003-2011, expectations run high among the 150,000 tribesmen living on West Qurna-2, the world's second-largest undeveloped oilfield.
    But it has been an uneasy co-existence since Lukoil's arrival two years ago sparked tribal disputes that set back the start of the $30 billion (18.7 billion pounds) project - crucial to Iraq's oil expansion - by more than a year to early 2014.
    Sheikh Qahtan said the company's arrival near their village had signalled a major change in the tribe's way of life.
    "There are no more fish here and no migrating birds. We used to go hunting from December to February every year. We are used to hunting, but we no longer do it. All these things disappeared when the oil industry entered the area," he said, sipping tea with tribal elders in their reed meeting house, 65 kilometres (40 miles) northwest of the southern oil hub of Basra.
    "It is fine that there are lights that have changed the look of the area, but it has not been for the best. We still hear about oil, but so far, we have not seen the benefits," he added.
    The Imara sheikhs say Lukoil needs to do more for their tribe, which dwells on the outskirts of the marshes, where miles of wasteland are dotted with baked mud huts, stagnant canals and palm trees.
    "They have not employed enough people from the area as workers. It is a simple area. It is true, I am sure that they are suffering, because the workers of this area have never seen such companies in their lives. They have never worked in such jobs," Sheikh Qahtan said.
    The main problem for Lukoil, acknowledged by the sheikhs, is that a generation of neglect has left many tribesmen illiterate and unmotivated.
    "What I want from them (Lukoil) is just a simple suggestion and I hope they will listen. Firstly, training. People have never seen (foreign) companies before and have not worked for them. They work in agriculture, they hunt, they rear animals. This is their way of living. But to do such work, this would be the first time for them. They do not know how to deal with the engineers or the drilling team. What I am suggesting to them is to teach them in order to qualify them for this work and not to just bring others in, so that at least they give them a trade," Sheikh Qahtan added.
    Lukoil says it has been doing just that since 2011 at its nearby training centre, which can enrol up to 350 students.
    The company says hundreds of local welders, carpenters, electricians, mechanics and riggers have become highly qualified workers who can easily find well-paid jobs in other regions after finishing work at the West Qurna-2 project.
    West Qurna-2 itself now employs about 11,000 people, two-thirds of whom are Iraqi nationals, according to Lukoil.
    But tribesmen feel their young people are getting a raw deal.
    "A small change, a small change and not a genuine one. It's a very small change because some of the unemployed youth who they have taken on are earning a daily wage, from six o'clock in the morning until six in the evening - 12 hours," said Sheikh Mansour Hamid al-Imara.
    When it comes to infrastructure, there are limits to what Lukoil can do to reverse the damage done by more than a decade of international sanctions after Iraq invaded Kuwait in 1990, and by the late former president Saddam Hussein, who accused the Marsh Arabs of treason during the 1980-88 war with Iran and drained the wetland.
    But the company says it is working to find ways of making improvements to the local area.
    "A number of projects have been implemented. Lukoil has done a better job than the other foreign oil companies when it comes to social development projects and it is still implementing projects. It has an annual programme agreed with the local government," said Ibrahim al-Maliki, security manager of South Oil Co (SOC), the Iraqi state partner in the project.
    Lukoil also says it has the support of the Imara tribe, whose tribal elders settled a major dispute in April that saw hundreds of protesters block a main entrance of the oilfield, demanding jobs.
    "Most of the Sheikhs, and especially those of the Imara tribe, were against demonstrations and they have supported Lukoil to continue its work. And now there is an improvement, there is an improvement in the economic situation in most of the surrounding areas," said al-Maliki.
    But for the young men playing billiards at a local caf� regular employment is hard to come by - even with a major potential employer on their doorsteps.
    "Jobs are scarce. They employ five to six people from each tribe. They are hiring people on contracts and not permanent jobs. The contracts are for four or five months and after that, they fire them. I did not get a job, but people who did had to pay 5,000 to 10,000 dollars (in bribes)," said Hatem Kareem, a 26-year-old blacksmith.
    The young men's frustrations extend beyond Lukoil to the central government.
    "I feel said because Iraq exports two-and-a-half million barrels of oil a day and I'm poor and my living conditions are bad. We do not have a comfortable life and no entertainment facilities to relax," Kareem said.
    West Qurna-2 lies beneath the farms where the Imara live and many still live in fear they will be driven off their land by drilling operations. SOC says it has paid $30 million in compensation to more than 800 farmers, and Lukoil is using horizontal drilling so as not to displace many others.
    By early next year, the giant field is expected to start commercial production of 150,000 barrels per day (bpd) and is targeting output of 1.2 million bpd.
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