Illegitimate Iraqi government prevents Russian companies return to country

The illegitimate nature of the Iraqi government is preventing the return of Russian companies to the country, said Russian Oil and Gas Industrialists Chairman Yuri Shafrannik at a press conference entitled Problems in Developing Russian Oil and Gas Complex yesterday. He said 'we are forced to work with the Iraqi interim government, even though it has no legitimacy.'

'Russia has had, has and will have chances to strengthen its position in Iraq. It's up to Russia not LUKOIL to make sure we don't lose the Western Kurna-2 field,' he said. Shafrannik added that the country's leaders and the ministry of foreign affairs are doing all they can to keep the project and a number of other projects in Iraq.

He said it is imperative Russian companies channel their resources to develop the resource base in Central Asia and expand the client base of oil and gas consumers in Europe. He also said it was necessary to limit the expansion of Russian companies within Russia because the domestic market was 'overheating.' Shafrannik added that the assets of Russian oil and gas companies are undervalued so it makes no sense to sell them now. Therefore, he said that only direct investment projects would be advantageous for the companies at this time.