Security challenges in Iraq

And yet, an increasing number of executives and top level managers are making the trips to Baghdad and Basra.

Sam Wilkin, Middle East Analyst for Control Risks gives Oil & Gas Middle East his insights to security trends in Iraq.

“The situation is considerably safer now than at the height of extremist violence in 2006-2007, particularly in the south of the country,” says Wilkin.
“The primary reason for this is the demobilisation of several Shia militias, most notably the Mahdi Army in 2008”, he adds.

The full withdrawal of US troops in December 2011 caused other Shia militias to lay down their arms as well, meaning that there is now very little insurgency in the southern regions of Iraq.

The insurgency has also wound down in Sunni areas since 2007, though the lack of effective Sunni representation in government means that levels of public discontent are much higher in these areas.

Extremist targeting patterns have also changed, and the terrorism threat to foreign businesses is now largely incidental; companies are increasingly prioritising other potential sources of risk, such as mismanagement of community relations.

“That said, in the past year, security incidents appear to have reached a relatively high baseline. Poverty and entrenched sectarianism will continue to drive crime, inter-communal violence and extremism.”

When assessing the impact of security risks on operations, companies must also consider the varying threat-levels in different parts of the country. “The security environment varies a huge amount in different areas of the country,” says Wilkin.

Baghdad remains an area of concern, and yet it is a place that executives of most companies operating in Iraq (except the Kurdistan Region) will have cause to visit at least on an occasional basis.

“Extremist violence poses a continued threat, but much less so in the south than in Baghdad and the north-central provinces,” says Wilkin. There is also the threat from crime, inter-communal violence and low-level social and tribal unrest.

The threat in remote areas, where many oil fields are located, is distinct from that in urban locations, and demands a strong programme of local engagement, he explains.

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In the Kurdistan Region, the security environment is considerably more benign than elsewhere in the country, particularly with regards to extremism. In short, there is no ‘one size fits all’ approach to security, adds Wilkin.

“The successful security plan will be closely tailored to the local environment and the company’s specific profile.”

While the Kurdistan Region may be the safest area of the country, the provinces to its immediate south, what Wilkin calls the north-central provinces, are among the most dangerous.

Other regions such as the south of the country are safer than Baghdad and the north-central provinces, but less safe than the Kurdistan Region.

“Even with these broad divisions, there are significant differences at the local level, driven by various factors such as demographics, sectarian fault lines, strategically or ideologically significant locations among others,” adds Wilkin.

In order to mitigate the different security challenges that operators and service companies face in Iraq, private security companies such as Control Risks have begun to provide mobile security services as well as rig site security management, project security management, and guarding of client sites and facilities.

With each region and operation presenting its own unique challenges, and with security issues being a major concern for many companies in Iraq.

Control Risks has grown within the country and around the world to provide bespoke services to the specific operating context and location of the client as well as their risk tolerance levels, without compromising its internal standards of security or risk thresholds.

Creating a set of solutions is no easy task, especially in Iraq. The best defence is probably not offense.

“Tactically, we believe the safest course is to avoid engaging in a conflict wherever possible,” says Wilkin.

Most security incidents occur during road moves, and companies such as Control Risks constantly monitor routes in the context of extremist targeting patterns, religious events, security force presence and various other local factors in order to minimize the probability of being caught in an incident.

“If an incident does occur during a road move, the best approach is normally to extract rather than confront the threat,” admits Wilkin. “All our teams are trained in evasive and defensive driving as well as combat skills,” he says.

For static guarding on the other hand, Control Risks advises implementing a layered approach to security, alongside a community relations programme which can help to reduce the chances of an attack occurring in the first place.

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Wilkin believes that the Iraqi security situation is improving at the same time, the government has repeatedly expressed its desire to have the army and police provide security across the country while letting foreign private companies take a smaller role.

For now, this appears to be a long-term goal and there is still considerable demand among foreign investors for private security.

“However, the state is gradually taking fuller control over the security situation which means enforcing strict standards and compliance on private providers,” he says.

Private security providers’ scope of work will also be constrained: for example by allowing only state security forces to carry out static guarding of oil fields, this has marked a major change which has already occurred in the Kurdistan Region, one which has altered the role of private security provders and their capacity to operate.

“Foreign security companies face a growing compliance burden in terms of adhering to local legislation and regulations, an emphasis on hiring and training local staff, and in some cases licenses are not being renewed,” says Wilkin.

“We expect the overall number of providers in Iraq to reduce in the coming years as a result,” explains Wilkin.

It is still unclear whether the declining number of private security providers is a blessing in disguise. On the one hand, the government is taking back ownership of security within the state, as any functioning government should do.

But, the loss of a security provider can lead to incremental costs as well.
If a security provider were to leave, collapse or even if its operations were temporarily suspended for example, it would cause oil and gas companies to incur considerable costs for every lost day of work.

“Companies therefore need to consider long-term prospects when choosing a security provider; key indicators to look for are the strength of their government relations, and their local employment record, among other factors,” advises Wilkin.

Nonetheless, the regulatory and operational environment is unpredictable and some larger companies choose to have two security providers.

At the same time, the security companies themselves are adapting their strategies to the changing environment.

“Co-ordinating and co-operating with the Iraqi security Forces and the Oilfield Protection Force is becoming increasingly important, as will increasing the proportion of Iraqi staff,” says Wilkin.

Hard security will remain necessary but a community-led approach will also be essential to prevent local unrest, which poses a significant threat particularly in areas where tribal allegiances trump all else.

Wilkin also advises companies to carefully vet all staff, and maintain positive relationships with local populations and security forces alike.
With all that said, Wilkin believes that, in Iraq, terrorist attacks are no longer the most significant threats to oil and gas companies.

“The security forces now have a decade of experience in combating terrorist groups, and oilfield security is also adopted to counter this threat. The greater threat stems from low-level terrorist attacks and other issues such as tribal unrest,” he says.