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UAE’s National Oil Firm Buys Share In Caspian Sea Field

Iran International Newsroom
Aug 5, 2023, 07:19 GMT+1Updated: 17:40 GMT+1
People walk by a Abu Dhabi National Oil Company (ADNOC) poster during the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC) in Abu Dhabi, United Arab Emirates, October 31, 2022.
People walk by a Abu Dhabi National Oil Company (ADNOC) poster during the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC) in Abu Dhabi, United Arab Emirates, October 31, 2022.

Abu Dhabi National Oil Company (ADNOC) is set to acquire a 30-percent equity stake in the Absheron gas and condensate field in the Caspian Sea.

According to the ADNOC on Friday, the agreement would see Azerbaijan's state oil company SOCAR and TotalEnergies, which had each previously held a 50-percent stake, both retaining a 35-percent share in the maritime field off the coast of Baku, Azerbaijan. 

TotalEnergies announced the first gas delivery from Absheron in July. The French energy group confirmed on Friday it and SOCAR had each sold a 15-percent interest in the field to ADNOC, without specifying the price.

The venture opens up opportunities for ADNOC to expand significantly in the Caspian region with rich energy resources and substantial growth potential, providing access to promising international gas markets in Europe and Central Asia. 

Following Russia's invasion of Ukraine in February 2022, the ADNOC has sharpened its focus on the gas market as competition for LNG has ramped up with Europe needing large amounts to help replace Russian gas. ADNOC listed its gas business in March after raising $2.5 billion from an initial public offering (IPO), which was the world's biggest in the first quarter of 2023.

Caspian region oil and natural gas infrastructure
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Caspian region oil and natural gas infrastructure

While the Islamic Republic is using the Caspian Sea as a route to move drones, ammunition, and mortar shells to Russia for use in Ukraine, other countries are vying for the huge European energy market. 

Iran is also cooperating with Russia in the Chalous gas field in the Caspian Sea, with the potentially lucrative field being at the center of discussions over an Iran-Russia 20-year strategic deal. In June 2021, Iran’s Khazar Exploration and Production Company (Kepco), then touted as the field’s main developer, suggested the field held 30 percent of the developable natural gas reserves of all Caspian Sea littoral counties and could potentially meet 20 percent of all European demand for gas. According to Simon Watkins of Oilprice.com in November 2021, further studies have revealed that the field has far more reserves than previously thought, with a total 7.1 trillion cubic meters, about half the reserves of South Pars, Iran’s huge field in the Persian Gulf.

The Caspian Sea was a Russo-Iranian shared water until 1991. Following the collapse of the Soviet Union, Kazakhstan, Azerbaijan, and Turkmenistan claimed a minimum 20-percent share of the sea. Tehran – along with Moscow – were the main losers of territory in the new demarcation of boundaries and prefer he Soviet-Iranian settlement to be valid in the post-Soviet era.

For almost three decades, the five littoral countries have argued over how to divide the world’s biggest enclosed body of water. The Convention on the legal status of the Caspian Sea -- a treaty signed in Aktau, Kazakhstan, in 2018 by the Islamic Republic of Iran, Russia, Kazakhstan, Azerbaijan, and Turkmenistan – significantly reduced Iran’s rights. Iran only controls 680 kilometers or, in other words, 10 percent of the 7,000-kilometer coastline of the Caspian Sea. Due to the presence of numerous oil fields on the seabed of the Caspian Sea the question of legal status is also very important, so the delimitation of the seabed is yet to be agreed on between littoral nations, Iranian President Hassan Rouhani said after signing the agreement.

Fifth Caspian Summit where the Convention on the legal status of the Caspian Sea was signed in August 2018
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Fifth Caspian Summit where the Convention on the legal status of the Caspian Sea was signed in August 2018

Nicolas Terraz, the president of exploration and production at TotalEnergies, welcomed ADNOC as one of the strategic partners to the project, saying the Absheron gas field “offers a significant further development potential to meet the growing gas demand.”

ADNOC's investment in Azerbaijan is in line with the UAE’s aspirations to grow its international gas business portfolio, a strategic plan that saw the oil giant offering with BP to jointly acquire 50% of Israeli offshore natural gas producer NewMed Energy. The $2-billion offer marked Abu Dhabi’s state oil company entering Israel's growing energy sector.

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Wildfires in Western Iran Rage for Second Consecutive Day

Aug 4, 2023, 22:59 GMT+1

As the forest fire near the border with Iraq enters its second day, an Iranian government official has highlighted the alarming extent of the blaze.

Saeed Karimi, the Director General of Kordestan Governorate Crisis Management, revealed that the fires are spreading across the forests of three border villages in Marivan.

Karimi expressed concerns over the fire's magnitude, stating, "The scope of these fires is very high." He also noted that the area faces additional risks due to the presence of ammunition remnants from the Iran-Iraq war, with recent explosions adding to the challenges faced by firefighters.

The affected villages include Gomareh Lang, Darreh Varan, and Asanabad, with firefighting efforts intensified to contain the devastating blaze. Despite round-the-clock efforts by volunteers, the blaze has already extended to a nearby village.

The cause of the fire has not yet been officially confirmed, but authorities have not ruled out potential involvement from security institutions or profiteers.

There are suspicions that the IRGC may be responsible, allegedly setting fire to the forests to hinder the concealment of individuals and groups classified as "terrorists" by the Islamic Republic.

This is not the first time such fires have affected the Kordestan province. Three years ago, parts of the Zagros forests in the Kosalan mountain area of Sarvabad city suffered an intentional fire, reportedly ignited by an individual on a motorcycle, causing destruction to over 15 hectares of forests.

Iran To Use Released Iraqi Funds To Pay Pilgrims' Annual Subsidy

Aug 4, 2023, 19:50 GMT+1
•
Iran International Newsroom

Amid reports of releasing Iran's frozen funds in Iraq, the Iranian regime intends to provide 200,000 Iraqi dinars ($153) to pilgrims who travel to Iraq for Arbaeen.

The Governor of the Central Bank of Iran, Mohammad Reza Farzin, said Thursday that from this year onwards, instead of euros and dollars, pilgrims will be paid in Iraqi dinars for their pilgrimage. 

The regime offers several perks to encourage people to take the pilgrimage such as a ration of cheap foreign currency – which used to be dollars or euros until this year – as well as loans, free internet on the road and inside Iraq and free health checks and rest stops along the way. 

Arbaeen (literally meaning fortieth) is a Shiite religious observance that occurs forty days after the Day of Ashura, when according to religious legend Husayn (Hussain) ibn Ali , the grandson of Prophet Muhammad was killed on the 10th day of the month of Muharram in 680 AD. 

Millions of Shiite Muslims travel to the Iraqi city of Karbala, the site of the Shiite Imam’s shrine and resting place, for Arbaeen. A large number of the pilgrims start their journey from other religious cities – such as Najaf and Kadhimiya -- and walk on foot for days – hundreds of kilometers -- to reach Karbala. There are no reliable methods for tallying the number of visitors to Iraqi holy Shia sites during Arbaeen. In 2019, before the pandemic, an estimated 15 million people from various countries attended the ceremonies.

Different kinds of refreshments are distributed among the pilgrims of Arbaeen.  (September 2022)
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Different kinds of refreshments are distributed among the pilgrims of Arbaeen.

Majid Mirahmadi, a deputy interior minister and the head of Iran's taskforce for Arbaeen pilgrimage, has predicted that this year more than four million Iranian pilgrims will travel to Iraq to participate in the Arbaeen ceremony, which falls on September 5.

The figure is a speculation based on the number of pilgrims in the previous years but this year the annual Shiite mourning ceremonies took an unprecedented anti-regime tone as people chanted religious verses that were critical of the regime and its repressive actions. This may signal a lower turnout for the Arbaeen this year. 

If Mirahmadi’s number is right, it means that Iranian banks will pay at least 800 billion Iraqi dinars to the pilgrims, which is equivalent to more than $600 million. Although the regime will sell the dinars to the pilgrims cheaper than the rate in the market, it can still pocket a large sum of its national currency and thus make a cash profit from its released funds. 

Earlier this week, the Biden Administration announced that some of Iran’s frozen funds in Iraq will go to Oman, acting as a conduit to release the money for purchasing non-sanctionable goods under US supervision. Iraq owes Iran around $11 billion for imports of gas and electricity, but US banking sanctions prohibit dollar transactions with Iran. 

In June, the US agreed to make $2.7 billion available for Iran’s humanitarian needs. In July, Iraqi Prime Minister Mohammed Shia Sudani said Baghdad will begin trading crude oil for Iranian gas to end payment delays to Tehran due to the need for US approval. 

Critics of the Biden administration slam the White House for inconsistent enforcement of sanctions against Iran’s oil trade, leading to the highest Iranian oil export levels since the United States withdrew from the Joint Comprehensive Plan of Action (JCPOA) in 2018 and imposed sanctions.

“It’s troubling to see the administration helping to fill Iran’s coffers while the Islamic Republic continues to increase its malign activities on all fronts: terrorism and terror finance, nuclear mendacity, hostage-taking, and assassination attempts, in addition to human rights abuses against its own people," said Toby Dershowitz, a Senior Vice President at the Foundation for Defense of Democracies. 

A group of Iranian pilgrims of Arbaeen on their way to the Iraqi city of Karbala (September 2022)
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A group of Iranian pilgrims of Arbaeen on their way to the Iraqi city of Karbala (September 2022)

Iran's Roads Ministry said in June that 2,000 buses have been imported for this year's Arbaeen pilgrimage to Iraq, despite the country’s serious shortage of buses for the national fleet and city transportation. Last year, Iran had designated 2,200 buses for pilgrims inside Iraq, but the Iraqi authorities did not allow the buses to enter the country.

The Iranian government spends hundreds of millions of dollars and huge resources each year to sponsor the Arbaeen pilgrimage to Karbala, among the largest annual gatherings in the world, to show that its Shiite ideology is influential both domestically and in the region.

Government organizations and the state affiliated charities as well as municipalities and city councils often allocate considerable budgets to organize the Arbaeen Walk. Some officials and clerics say the Arbaeen gathering is one of the manifestations of the Shia “soft power’.


Bread Price Hikes Force Iranians To Buy Half Loaves

Aug 4, 2023, 16:17 GMT+1

As bread prices soar in 13 provinces, Iranians are being forced to purchase only half a loaf of bread due to the steep cost in an unprecedented trend.

Low-income workers in particular are feeling the brunt of the price surge with bread being consumed as part of two or three daily meals. This sharp increase in bread prices could potentially trigger an inflationary shock.

Iran's state television confirmed the price hike in the staple food on Thursday after weeks of contradictory statements from officials. Previous denials regarding the government's intention to increase bread prices have now been overshadowed by the reality of rising costs.

Following subsidy reforms in May last year, Minister of Economy, Ehsan Khandouzi, had explicitly stated that an increase in bread prices was a "red line" set by the President, with other officials echoing the sentiment. However, despite these assurances, bread prices have witnessed an increase in several provinces, risking fueling social unrest further.

In an interview with ILNA news agency, labor activist Framarz Tofighi pointed out that the high prices are not limited to bread alone. “Dairy products have vanished from workers' tables, rice has become unaffordable for many, and even sugar has seen significant price spikes,” he said.

Bakery workers are also suffering the consequences of the rising bread prices, questioning why they and the general public should bear the burden of increased bakery costs as they suffer surges in rent, taxes, and energy bills that remain unaddressed.

Currently the official annual inflation rate is 47.5 percent – the highest rate in Iran for more than 30 years -- but prices for food are most affected, with the price of cooking oil rising by more than three times annual inflation at 145 percent, and the price of meat also rising by 78 percent over a one year period (point-to-point), while around 60 percent of Iranians now forced below the poverty line.

Iran Drinking Water Crisis Hits Tabriz, Third Day Without Water

Aug 4, 2023, 11:47 GMT+1

Drinking water supply in large areas of Tabriz, Iran's Northwestern city, has been cut off for three consecutive days.

Residents have endured complete water cuts or limited access to low-pressure water during specific hours as temperatures soar as high as 37 degrees celsius in the East Azarbaijan Province. According to local media, the extensive water shortage was not preceded by any notification.

Mohammad Khani, CEO of East Azarbaijan Water and Sewerage Company, attributed the water cut to a sudden 20% surge in consumption due to the recent countrywide heatwave.

Pictures published by social media users of Nahand Dam, a vital water supply source for Tabriz, illustrates its alarming depletion compared to previous years.

The water crisis is not isolated to Tabriz, with widespread cuts in many other areas of East Azarbaijan province, particularly in dozens of villages. People in Jigheh village, for example, have been left with water for only 20 minutes every 72 hours, prompting them to dig wells in search of springs or other water sources.

This situation mirrors similar water shortages experienced in other Iranian cities. Zahedan endured several days of drinking water cuts in July, while Ahvaz faced similar challenges in various areas.

Even smaller towns across different provinces have been hit by drinking water cuts such as Divandarreh in Kordestan province causing residents to take to the streets to protest on Monday, resulting in injuries from tear gas fired by authorities to disperse the crowd.

Iran Seeks UN Help To ‘Disarm’ Iraqi Kurdish Parties

Aug 4, 2023, 10:24 GMT+1

Iran's ambassador to Baghdad called for the assistance of the United Nations in “disarming Kurdish opposition parties” operating in Iraq.

In a Thursday meeting with Jeanine Hennis-Plasschaert, the Special Representative of the Secretary-General for Iraq and Head of the United Nations Assistance Mission for Iraq, Mohammad Kazem Al-e-Sadegh highlighted the activities of Kurdish parties opposing the Islamic Republic in the Kurdistan Region.

According to the IRNA state news agency, Al-e-Sadegh claimed that the UN's cooperation is necessary to counter the “threat” posed by these parties who are openly leading calls to overthrow the regime and are blamed for much of the unrest the country has witnessed since September.

Iran has previously urged both the Iraqi government and the Kurdistan Regional Government to disarm the Kurdish parties based in the Kurdistan Region. Iran's officials have warned that failing to comply with this demand would lead to military action against these parties' camps within Iraqi territory.

Last year, a security agreement was signed between Iran's former secretary of the Supreme National Security Council, Ali Shamkhani, and his Iraqi counterpart, with a significant portion dedicated to the disarmament of Iranian opposition parties in the Kurdistan region of Iraq.

Iran's Revolutionary Guards have conducted missile and drone attacks against Iranian Kurdish groups based in northern Iraq, a reaction to the Iranian Kurdish parties allegedly instigating protests, triggered by the death of Mahsa Amini, an Iranian Kurdish woman, while in the custody of the morality police.

The Kurdish parties involved, such as Komala and the Kurdistan Democratic Party of Iran (KDPI), generally advocate for Kurdish autonomy within a federal Iran.