meed-logo

line1 line2 line3
SIGN IN / REGISTER

Sudani makes fitful progress as Iraq’s premier

10 May 2023

 

Mohammed al-Sudani has served almost 200 days as Iraq’s prime minister since being sworn into office in late October.

In that time, he has launched a high-profile anti-corruption drive, sought to repair relations between Baghdad and the Kurdistan region, find an amiable balance in relations with Iran on the one hand and the Arab Gulf states and Western powers on the other, as well as giving greater stability to the state’s finances.

These are challenging issues and it remains too soon to judge if he can succeed, but progress on many fronts has often appeared fitful at best.

Soon after coming into office, Sudani threw his weight behind a high-profile anti-corruption drive, prompted by the multibillion-dollar ‘Heist of the Century’, which emerged just before his government took charge. The scandal involved the theft of an estimated ID3.7tn ($2.5bn) from the General Commission for Taxes.

However, after some early positive signs, observers say that the anti-graft drive appears to be losing momentum. One of the main suspects, Haitham al-Jubouri, was released on bail in January. The assets of another suspect, Nour Zuhair Jassim, were unfrozen by a court in April.

Corruption has been endemic in Iraq for years and continues to hobble the economy. There has also been limited progress in other areas of economic activity.

As the Washington-based IMF pointed out in its most recent Article IV report on Iraq, issued in early February, the economy has been growing, but that is in large part due to high oil prices. Indeed, it said Iraq’s dependence on oil revenues has increased rather than decreased.

Gas deal success

The importance of the energy sector is unlikely to diminish anytime soon, given current project activity. Sudani was involved in broking a deal with French oil major TotalEnergies in early April over the $10bn Gas Growth Integrated Project (GGIP), following four meetings with its chief executive Patrick Pouyanne.

The mammoth scheme had been announced in September 2021, but had stalled amid a dispute between Baghdad and Total over what size holdings each side would have. A resolution was helped by the arrival of QatarEnergy, which has taken a 25 per cent stake, leaving Iraq with 30 per cent (held via state-owned Basra Oil Company) and Total with 45 per cent.

That should enable more productive use of the country’s gas resources in the future and will also see the development of a 1GW solar power plant.

On the other hand, oil exports through Turkey have stopped since the International Chamber of Commerce (ICC) arbitration court in Paris ruled in favour of Baghdad in late March over Kurdish oil flows to Turkey via a cross-border pipeline.

Sudani has been building good publicity and a positive image for himself domestically and abroad, but it’s a rather thin veneer, behind which the machinery of entrenched interests is carrying on as usual
Omar al-Nidawi, Enabling Peace in Iraq Centre

Mixed reception

The former Iraqi ambassador to the US, Rend al-Rahim, has described Sudani as an “energetic and shrewd politician” – both necessary qualities to rise to the top in Baghdad and even more important to survive. Others have been less impressed by Sudani’s performance, though.

“He has been building good publicity and a positive image for himself domestically and abroad, but it’s a rather thin veneer, behind which the machinery of entrenched interests is carrying on as usual,” says Omar al-Nidawi, director of programmes at the Washington-based Enabling Peace in Iraq Centre (Epic).

Sudani came to power due to the support of former prime minister Nouri al-Maliki and the Coordination Framework, the grouping of Shia-majority parties with close links to Iran. They and their related militias remain influential to this day – part of a political system in which groups continue to use the state’s resources to entrench their own influence.

Budget concerns

Sudani’s budget plans have prompted concern among some about how that system of patronage might grow even larger. A three-year budget covering the period 2023-25 was finalised by the cabinet in mid-March and then sent to parliament in what was his administration’s first major piece of legislative action.

It included record spending of some ID198tn ($152bn) a year, including current spending of ID150tn and capital expenditure of ID48tn, as well as record annual deficits of some ID63tn, based on an average oil price of $70 a barrel and output of 3.5 million barrels a day (b/d). The plans include a sharp rise in the public sector wage bill, taking that item to a total of ID88tn.

That approach was the opposite of what the IMF had urged Sudani to do. In February, it said the government should save “the bulk of the oil windfall” and added that the 2023 budget “should avoid a procyclical spending boost and aim to increase savings with a gradual tightening of the fiscal stance”.

According to Nidawi, the budget plans point to a government that is more focused on using the state’s resources to bolster its support and minimise criticism rather than rebuild the economy. He described the budget as “exceptionally disappointing”, adding that the spending measures “threaten to waste the financial surplus from high oil prices by expanding the already bloated public payroll”.

The budget also included an attempt to find a new modus vivendi with the Kurdistan Regional Government (KRG), allowing for a 12.7 per cent budget share for Kurdistan and joint management of some 400,000 b/d of oil from the region. Sudani said on 13 March that Baghdad and Erbil had reached “a comprehensive agreement”. However, it remains to be seen if the system they have agreed will work effectively in practice.

In addition, Sudani’s budget has yet to be passed by parliament, and MPs could still force him to change his approach – a final vote may not happen until late May. What is not expected to change, for a time at least, is the parliament itself. When Sudani took office, it was amid speculation that an early election could be called, following the resignation of Moqtada al-Sadr’s bloc of MPs.

Since then, the idea of an early poll has faded and Sadr has remained in the background. Should he decide to change tack once again, Sudani could quickly face a far more challenging political situation, given Sadr’s past ability to quickly fill the streets with his supporters. At that point, Sudani’s political strengths and weaknesses will become far more apparent.

Iraq power projects make headway

https://image.digitalinsightresearch.in/uploads/NewsArticle/10834536/main.gif
Dominic Dudley

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Abu Dhabi selects team for 3.3GW Al-Nouf IPP

    9 June 2026

     

    State utility Emirates Water & Electricity Company (Ewec) has selected a preferred developer and contractor for the 3.3GW Al-Nouf independent power producer (IPP) project in Abu Dhabi, according to sources.

    Located within the newly established Al-Nouf complex, the facility will be the largest single-site, carbon-capture-ready, combined-cycle gas turbine plant in the UAE. 

    Japan’s Sumitomo Corporation has been selected as the preferred developer, with the power-purchase agreement (PPA) expected to be signed in the coming weeks, sources said.

    It is also understood that a joint venture of Spain’s Tecnicas Reunidas and Egypt’s Orascom Construction has been picked as the preferred engineering, procurement and construction (EPC) contractor.

    Three developer consortiums submitted bids earlier this year, along with Sumitomo as the only company to bid individually.

    The bidders included:

    • Aljomaih Energy & Water (Saudi Arabia) / Sembcorp Industries (Singapore) / EDF Power Solutions (France)
    • Engie (France) / Korea Overseas Infrastructure & Urban Development Corporation (Kind) / Korea Western Power Company (Kowepo)
    • Korea Electric Power Corporation (Kepco) / Etihad Water & Electricity (EtihadWE) (UAE)
    • Sumitomo (Japan) 

    Ewec issued a request for proposals for the project last August. It had previously received statements of qualifications for the contract in April 2025.

    This follows confirmation earlier this month that Ewec has signed a PPA with a developer consortium for the 2.5GW Taweelah C IPP project.

    A team of UK-based Alderbrook Finance and US-based Sargent & Lundy is providing financial and technical advisory services to Ewec for the Taweelah C IPP.

    As MEED previously reported, both projects are following the model of Abu Dhabi’s IPP programme, in which developers enter into a long-term agreement with Ewec as the sole procurer. 

    This involves the development, financing, construction, operation, maintenance and ownership of the plant, with the successful developer or developer consortium owning up to 40% of the entity. The remaining equity will be held indirectly by the Abu Dhabi government.

    The project site for the Al-Nouf plant was selected for its ability to accommodate both seawater-cooled power generation and reverse osmosis desalination technologies. The plant will have the capacity to support several utility-scale energy and desalination projects in the future.

    The facility is scheduled to begin commercial operations in the third quarter of 2029.

    > Be recognised among the best in the industry at the MEED Projects Awards 2026 …

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17155245/main.jpg
    Mark Dowdall
  • Zoom launches new Saudi data centre at center3

    9 June 2026

    Zoom has announced a new data centre in Saudi Arabia to boost in-kingdom capacity for government and enterprise customers requiring local data residency.

    In a statement, Zoom said the data centre is located within center3, a Saudi-headquartered provider of carrier-neutral data centres and subsea cable systems linking Europe, Asia and Africa. Zoom said the data centre builds on its broader investment plans in the kingdom, including a $75m commitment made last year focused on artificial intelligence (AI)-enabled innovation and the advanced infrastructure required to scale it.

    Zoom said its existing regional data centre, established in 2023, already supports customers with local data residency requirements, while the new site will enhance services for government entities, enterprises and critical national infrastructure organisations.

    AI is an important part of Saudi Arabia’s economic growth plans leading up to 2030. In January, government officials confirmed that as the global economy is evolving rapidly with the rise of AI, some projects such as The Line at Neom have slowed down, while other projects related to the World Cup, Expo 2030, technology and AI have accelerated. 

    The largest AI project in the kingdom is being developed by Humain, which is owned by the Public Investment Fund (PIF). In May, it issued a tender inviting firms to develop infrastructure for its planned 6GW hyperscale AI data centre campus in Riyadh.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17155250/main.jpg
    Colin Foreman
  • Joint venture confirms Saudi rail construction deal

    9 June 2026

    A joint venture of OHL Arabia, the Saudi subsidiary of Spain’s OHLA, and Hassan Allam Construction Saudi Company, a subsidiary of Egypt’s Hassan Allam Holding, has confirmed it has been awarded the contract to complete construction works on the Dammam 2nd Industrial City railway connection project in Saudi Arabia.

    In a statement, the companies said they will deliver the full scope of civil engineering and railway works, including the development of a 22.7-kilometre single-track railway supported by extensive civil foundations, earthworks and track infrastructure. The project also includes major structures, notably a 265-metre bridge over Highway HW615 and a 118-metre bridge over the Aramco Pipeline Corridor.

    The scope also covers the installation of signalling and telecommunications systems, as well as all works required by Saudi Electricity Company to ensure full integration of the new line into the wider network. MEED reported in January that OHL and Hassan Allam had been selected for the SR500m ($133m) contract. SAR tendered the contract in April 2025.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17154866/main.jpg
    Colin Foreman
  • Construction of $13bn Trans-Sahara gas pipeline starts in Algeria

    9 June 2026

    On-the-ground work on the Trans-Saharan Gas Pipeline (TSGP) has officially started, according to a statement from Algeria’s oil and gas ministry.

    Project work has begun in southern Algeria, and the project will be jointly supervised by the oil and gas ministries of Algeria, Nigeria and Niger, the statement said.

    The project is estimated to be worth $13bn-$25bn.

    It will span more than 4,000 kilometres from Nigeria to Algeria and is jointly sponsored by Nigerian National Petroleum Company (NNPC), Algeria’s Sonatrach and Niger’s Sonidep.

    Designed to link gas fields in Nigeria through Niger to Algeria, the pipeline will connect to existing Mediterranean pipelines that are linked to European gas networks.

    The start of work on the Algerian section of the pipeline was hailed as a “historic event” by Algeria’s oil and gas ministry.

    It said that a ceremony to launch the project was attended by Algeria’s oil and gas minister Mohamed Arkab, his Nigerian counterpart Ekperikpe Ekpo and Niger’s Hamadou Tini.

    The heads of the state-owned companies Sonatrach, NNPC and Sonidep also attended the ceremony.

    The pipeline is designed to transport between 20 billion and 30 billion cubic metres of natural gas annually.

    In its statement, Algeria’s oil and gas ministry said that officials had adopted the final feasibility study prepared by UK-based Penspen.

    The contract was awarded to Penspen in March last year, with a six-month completion period.

    In March last year, Penspen said that the pipeline was “a landmark infrastructure project with the potential to transform African energy dynamics, enhance economic integration and bolster global energy security”.

    It also said: “This ambitious initiative is poised to unlock new economic opportunities for transit countries, foster regional cooperation and support Africa’s growing energy demand.”

    The TSGP project was initiated in 2002 by the collaborative efforts of Nigeria and Algeria, with Niger admitted as a co-sponsor in 2008.

    Penspen delivered the original feasibility study for the project in 2006, finding the pipeline to be technically and economically feasible and reliable.

    Last year, Penspen was engaged to revalidate and update the feasibility study, considering earlier route options.

    The study included an analysis of the regional gas market. It also included environmental and social evaluations, economic and financial analysis, cost estimation, legislation and consultation reviews, risk analysis, and the development of the scope of work for the front-end engineering and design work.

    READ THE JUNE 2026 MEED BUSINESS REVIEW – click here to view PDF

    GCC looks beyond the Strait; Iraq’s reform window narrows as fiscal assumptions shatter; MEED Top 100 companies.

    Distributed to senior decision-makers in the region and around the world, the June 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17150012/main.jpg
    Wil Crisp
  • Lebanon taps foreign players to assess resource potential

    8 June 2026

     

    Lebanon’s oil and gas sector received a major boost in January this year when French energy major TotalEnergies, Italy’s Eni and QatarEnergy signed an agreement with the Lebanese government to enter the Block 8 concession in the country’s territorial waters and explore for gas reserves.

    Under the terms of the deal, TotalEnergies will operate Block 8 and hold a 35% interest, while Eni and QatarEnergy will hold 35% and 30% stakes, respectively.

    Block 8 has long been considered the most promising exploration area in Lebanese waters, but previous efforts to award the exploration permit were repeatedly delayed amid concerns over border tensions and political instability.

    The block lies along the previously disputed maritime boundary between Lebanon and Israel. In 2022, the two countries signed an agreement to resolve the long-running maritime border dispute.

    In a statement, TotalEnergies said: “The consortium's initial work programme on Block 8 consists of the acquisition of a 1,200-square-kilometre 3D seismic survey in order to further assess the area’s exploration potential.”

    Exploration efforts

    The Lebanese Petroleum Administration hopes that international oil companies will make discoveries that will help bolster the country’s struggling economy.

    Lebanon signed its first offshore oil and gas exploration and production agreement in February 2018, awarding Blocks 4 and 9 to a consortium comprising TotalEnergies, Eni and Russia's Novatek following a licensing round in 2017.

    In January 2023, QatarEnergy replaced Novatek in the consortium.

    Under the agreement, QatarEnergy acquired Novatek’s 20% stake, as well as 5% each from TotalEnergies and Eni, giving the Qatari company a total stake of 30%. TotalEnergies and Eni each retained a 35% interest.

    In TotalEnergies’ latest statement, chairman and CEO Patrick Pouyanne said: “Although the drilling of the Qana 31/1 well in Block 9 did not yield positive results, we remain committed to pursuing our exploration activities in Lebanon.

    “We will now focus our efforts on Block 8, together with our partners Eni and QatarEnergy and in close cooperation with the Lebanese authorities.”

    Futile attempts

    More broadly, Lebanon’s offshore oil and gas sector faces an uncertain outlook, characterised by persistent delays, regional conflict and limited exploration activity.

    Despite hopes that maritime agreements and improved diplomatic relations would trigger an energy boom, Lebanon currently produces virtually no oil or natural gas. Political bottlenecks, regional instability and previous dry wells have increasingly shifted attention towards alternative domestic energy solutions.

    Lebanon’s ambition to become a hydrocarbon producer remains unfulfilled due to a combination of commercial and political obstacles. Initial optimism was tempered when consortiums led by TotalEnergies announced that no commercially viable gas discoveries had been made in either Block 4 or Block 9.

    Despite holding licences for potentially prospective acreage, international companies have remained largely inactive in pursuing further deepwater exploration.

    Meanwhile, Lebanon’s third offshore licensing round, launched in 2024, has continued to face delays. Nine offshore blocks within the country’s exclusive economic zone were offered, but interest from exploration and production companies has been limited. As a result, the government has repeatedly extended submission deadlines.

    Although the landmark 2022 maritime boundary agreement with Israel removed a major obstacle to exploration in southern waters, regional security concerns continue to influence the pace of development.

    In late 2025, Lebanon approved a maritime boundary demarcation agreement with Cyprus aimed at clarifying jurisdictional rights and attracting investment to offshore areas.

    Progress in northern waters also remains stalled. More than 652 square kilometres of offshore acreage overlap between Lebanese- and Syrian-claimed waters, making any resolution politically sensitive and diplomatically complex.

    Regional volatility continues to weigh on investor confidence. While periodic ceasefires may provide temporary relief, ongoing tensions across the region still make large-scale energy infrastructure investments highly risky.

    READ: Activity ramps up in Syria’s oil and gas sector

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17145363/main.gif
    Indrajit Sen