BAGHDAD — Iraq's new oil minister appointed Tuesday was a close aide to his predecessor, suggesting he is likely to keep pursuing investment by international energy companies for the lucrative sector.
Abdul-Karim Elaibi, a Shiite, replaced Hussain al-Shahristani who was the architect of Iraq's plans to lure international investment to its beleaguered industry. As senior deputy in the oil ministry, Elaibi was instrumental in overseeing Iraq's oil deals with Western companies and neighboring countries.
Iraq has awarded 15 oil and gas deals since 2008 to international energy companies in the first major investment in the country's energy industry in more than three decades.
"Elaibi means good continuity for the oil companies," said Samuel Ciszuk, Mideast energy analyst with IHS Global Insight in London. "He was very much involved in the negotiations of the contracts. He was very much involved in the talks with the oil companies."
Iraq hopes to raise output to 12 million barrels per day by 2017 — a level that would put it nearly on par with Saudi Arabia's current production capacity — from around 2.4 million barrels currently.
But Elaibi will have an uphill battle achieving those ambitious oil output targets which are seen by some analysts as unrealistic, given Iraq's damaged oil infrastructure, bureaucracy and corruption.
Elaibi also has to address the more than two dozen oil deals the northern self-ruled Kurdish government unilaterally signed with Western companies which al-Shahristani considered illegal. The previous minister, al-Shahristani, blacklisted the companies involved from participating in any deals in the rest of Iraq.
The new oil minister was born in Baghdad in 1959 and holds a B.A. degree in oil engineering from the University of Baghdad. He started his career in 1983 with the state-run South Oil Company and occupied several posts within the ministry before reaching his latest position.
In the new government, al-Shahristahi will be the deputy prime minister for energy, a newly created post. It is still unknown what influence and powers it will have over the growth of oil production and exports.
It is believed that al-Shahristani still intends to wield a great deal of influence over this vital sector of Iraq's economy.
Iraq holds the world's fourth largest oil reserves of 143.1 billion barrels, according to the government's latest estimates. Oil revenues make up nearly 95 percent of Iraq's budget.