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lack of skilled iraqi employees preventing oil industry progress

Mayada Daood
In a country where the unemployment rate has caused mass demonstrations, one local economist believes that Iraq lacks thousands of skilled workers for the oil industry – and that this is preventing progress…
16.08.2012  |  Baghdad

It is the lack of skilled local labour in Iraq’s oil and gas industries that is preventing this all-important industry from progressing the way it should. At least, that is the opinion of Iraqi economist, Abdul Rahman al-Mashhadani, who heads the Mustansiriya Centre for Arab and International Studies, part of Mustansiriya University in Baghdad.

Al-Mashhadani estimates that, in order for Iraq to reach its much vaunted target of 12 million barrels of oil a day by 2017, the country needs another 150,000 skilled workers for the oil industry.

“We cannot achieve our great ambitions with the number of workers we have now,” al-Mashhadani told NIQASH. “The difference between the number of skilled workers needed and the actual number of skilled workers Iraq has accounts for the many foreign labourers here. There are hundreds of foreign workers in places like Basra and Amara, where much of Iraq’s oil is being produced.”

The Ministry of Oil in Iraq also admits that the country needs thousands more skilled labourers but, unlike al-Mashhadani, it was unable to put an actual number on that need as it is only just finalizing a report on the study.

However Ministry spokesperson, Asem Jihad, did refute al-Mashhadani’s numbers, saying that the economist’s projected figures were exaggerated. He may be right. According to other local analysts, an estimated 10,000 workers are needed per each extra million barrels of oil. And then according to international oil firms like British Petroleum (BP), French company Total and Italy’s ENI, Iraq needs anything between just over 5,000 workers per million barrels of oil to just over 7,000.

Recent comments from the Iraqi government also suggest that a more realistic target is around 9 million barrels per day by 2020 – which lowers the number of desired oil industry workers again.

Jihad also noted that oil companies working in Iraq are contractually obligated to train locals in the different provinces. Money that the Iraqi government gets from the oil companies is put toward training and the development of the Iraqi labour market. “Iraqi oil contracts stipulate that foreign companies should employ at least 85 percent locals and not more than 15 percent foreigners.”

Additionally, the government has devoted funds to the establishment of a training institute dedicated to the oil and gas industry. Apparently the foundation stones for the tertiary institute were laid nine months ago but the institute is yet to open, due to ongoing construction work, the building of laboratories and the finalization of a curriculum.

There are also international companies, such as France’s Cegelec in the Basra area, involved in training Iraqis to enter the oil and gas industry.

Because of the clear need for skilled employees in the oil industry, many new graduates or would-be graduates are heading in that direction with their studies.

Before the increase in oil industry jobs, student Mohammed Nathim was planning to train as an engineer. But after seeing many graduates unable to find jobs, he has decided he wants to attend an oil industry academy.

“Going to an oil academy gets you extra privileges,” Nathim adds. “The students with the highest grades can get a scholarship to their university because the Ministry pays their fees.”

“I prefer to go to oil college, graduate in two years and then be paid to study,” Nathim’s friend, Abbas Shaheen, notes. “After that I could work for the Ministry of Oil – rather than spending four years at university and then joining the long list of unemployed.”

There is also a website and forum founded by young Iraqis that focuses on questions about oil industry education and oil industry jobs. On the site, young Iraqis considering further education in the oil industry can ask questions and have them answered.

“Iraq has many skilled people but what we’re missing is skilled people in the oil industry,” Iraqi oil expert, Hamza al-Jawhari, told NIQASH. “We can overcome this by more training, both inside and outside of Iraq.”

It was also important to remember that Iraq’s increasing oil production doesn’t just require oil industry specialists. Although the oil industry employs relatively few people, in comparison to the revenue it provides the country, “we will also require people with administrative and legal backgrounds as well as graduates in chemistry, physics and mechanics,” al-Jawhari noted.