A conference that would have brought much needed investments and economic development in Iraq has been rescheduled to next year amid security concerns.
Iraq Future Energy, an annual forum that draws international oil majors and oilfield services firms, was postponed after Schlumberger and Baker Hughes suspended their operations in the country following an outbreak of protests at Rumaila oilfield in Basra.
Tensions flared after two separate incidents occurred at Baker Hughes and Schlumberger where non-Iraqi staffers tore down a banner of Imam Hussein, a revered Shiite figure. Angry workers and tribesmen protested and wrecked offices in response to what they saw as religious insensitivity.
Iraq Future Energy's fourth annual conference was scheduled to take place in Basra next week for the first time in Iraq. Previous sessions were held in Istanbul, Turkey.
"We were looking at the situation last week and couldn't be sure what was going to transpire," said Lisa Meli, the marketing manager for Energy Exchange, Iraq Future Energy's event organiser. "Given what happened at the Schlumberger camp in the preceding week, there's a precautionary lockdown in that area and [it] has impacted people's ability to move."
The first incident took place on November 9 at Baker Hughes, where an Egyptian staffer tore down a poster of Imam Hussein. Two days later, a British security contractor at Schlumberger tore down another poster, causing enraged Shiite staffers to vandalise the office. Subsequent gunshots injured one person and attracted the attention of dozens of people nearby. A YouTube video showed a British security officer was injured, with blood streaming down his face.
In a filing to a United States stock exchange, Baker Hughes said the incident was under investigation and it had issued forced majeure notices - a clause in contracts to remove liability for natural and unavoidable catastrophes - to its customers.
Martin Craighead, the chairman and chief executive of Baker Hughes, said the safety and welfare of the firm's employees were its top priorities.
"While we investigate this incident, and until the work environment has stabilised, we are halting activities in Iraq," he said. "We hope to resolve this issue in a timely manner, and resume operations in support of our customers and the country of Iraq, as soon as it is safe to do so."
About 100 to 150 delegates from oil majors, vendors and governments signed up to attend the Iraq Future Energy conference. The event was sponsored by the Iraqi parliament, the Basra governate, BP and the Iraq Energy Institute.
Tensions have been steadily rising between Iraq's two major religious sects, Shia and Sunni, following a surge of attacks targeting mostly Shia neighbourhoods.
Since the start of the year, sectarian-related attacks have claimed the lives of more than 3,900 Iraqis, according to an Agence France-Presse tally.
In recent years, several international oil firms have struck a wrong chord with Iraqi officials after flocking to the autonomous region of Kurdistan in search of lucrative oil contracts.
ExxonMobil, Chevron and Total were blacklisted after signing agreements with the Kurdish Regional Government, which Baghdad denies the right to independently strike oil contracts.
Nevertheless, Iraqi oil production has exceeded the 3 million barrels per day mark for the first time in the post-Saddam Hussein era.