October 8, 2018 / 12:01 PM / 9 months ago

Iraq oil minister says new contracts will have local hire stipulations

FILE PHOTO: Iraqi Oil Minister Jabar al-Luabi speaks during a news conference in Baghdad, Iraq January 22, 2018. REUTERS/Khalid al-Mousily /File Photo

ERBIL, Iraq (Reuters) - Iraq will stipulate in all new contracts with foreign oil companies that 85 percent of the workforce hired on a project be Iraqi, Oil Minister Jabar al-Luiabi said on Monday.

The requirement will affect all contracts whether in extraction, refining, making use of by-product gas, or developing infrastructure, the oil ministry said in a statement quoting Luiabi.

He made the comments in a message to attendees of the Basra Megaprojects Conference being held in Istanbul.

Stipulations allowing Iraqi investors to invest at least 20 percent of the capital needed for a project will be introduced, he said.

He added without elaborating that construction and building companies that are part of the ministry “will contribute by at least 25 percent in all upcoming contracts”.

The new contracts will also ensure that foreign oil companies start projects that improve services such as infrastructure, education, health, and water.

Luiabi’s comments follow months of protests in the oil-rich southern province of Basra, which contributes 95 percent of Iraq’s oil revenues but suffers from poor basic services, unemployment, and where residents lack access to clean water.

Reporting by Ahmed Aboulenein, Editing by William Maclean

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