Petrochemical giant Saudi Basic Industries Corp (SABIC) plans to open an office in Iraq soon, Saudi Arabia’s energy minister said during a visit to Iraq’s southern oil city of Basra, as relations between Riyadh and Baghdad thaw.
The headquarters of Saudi Basic Industries Corp (SABIC) is seen in Riyadh, Saudi Arabia April 19, 2016. REUTERS/Faisal Al Nasser
Speaking at an oil and gas conference in Basra, Khalid al-Falih called for increased economic cooperation and praised existing coordination with Iraq to help balance the oil market and boost crude prices.
“I would like to announce that SABIC is in the final stages of reopening its office in Iraq, which will result in the availability of petrochemical materials and offers opportunities for (the company) to expand its investment in this sector,” Falih said in a speech late on Monday.
Saudi Arabia’s Industrialization & Energy Services Co (TAQA) is also opening an office in Iraq which will “enhance the presence of the Saudi private sector in Iraq and support initiatives to expand investments,” he added.
Falih, who is also the minister of industry and mineral resources, said that soon the two countries would discuss a power-grid link initiative and investments in renewable energy and power generation projects.
“Cooperation and integration with Iraq represents a strategic direction in the top priorities of the kingdom,” Falih said.
Saudi Arabia is wooing Baghdad in an effort to halt the growing regional influence of arch-foe Iran.
The two countries began taking steps towards detente in 2015 after 25 years of troubled relations starting with the Iraqi invasion of Kuwait in 1990.
Tension remained high after the 2003 U.S.-led invasion of Iraq, which toppled Saddam Hussein. The American occupation of Iraq empowered political parties representing Iraq’s Shi‘ite majority, close to Saudi Arabia’s regional rival Iran.
Iraq is seeking economic benefits from closer ties with Riyadh while Saudi Arabia hopes a stronger relationship with Baghdad would help rollback Iran’s influence in the region.
In August the two countries said they planned to open the Arar land border crossing for trade for the first time since 1990.
Saudi Arabia and Iraq are respectively the biggest and second biggest producers of the Organization of the Petroleum Exporting Countries (OPEC).
OPEC and non-OPEC producers led by Russia agreed on Nov. 30 to extend oil output cuts until the end of 2018 to help lower global inventories and support prices.