"The delegation, led by Deputy Oil Minister Ahmad al-Shama, left Baghdad today to meet the representatives of 17 American, British French, Japanese, Canadian, Italian, Chinese and Dutch energy firms," said oil ministry spokesman Asim Jihad on Monday.

  

Iraq wants "to build in the next three years a new oil refinery with a capacity of 250,000-300,000 barrels per day (bpd) at an estimated cost of $2 billion".

  

The ministry wants to build the refinery on a Build-Operate-Transfer contract in order to avoid putting further burdens on Iraq's tattered economy, Jihad said.

 

New refinery

  

A new refinery would enable the ministry to solve the problem of domestic fuel shortages and allow it to renovate the aging Baiji refinery to the north and Dura refinery in southern Baghdad, which are in poor shape, Jihad said.

  

In mid-February, the oil ministry estimated its exports from the port of Basra at 1.5 million bpd and the country's overall production at two million bpd.

 

Iraq relies on its oil resources to
keep its economy afloat

But the industry has been crippled by rotting infrastructure, attacks and smuggling.

  

The ministry estimated in February its losses at between $7 billion and $8 billion due to resistance attacks since the fall of Saddam Hussein's government in April 2003.

  

Iraq, with the second largest oil reserves in the world, relies on its lucrative oil resources to keep its economy afloat.

  

In January 2004, Oil and Gas Journal estimated Iraq's refining capacity at the country's largest refinery in Baiji at 587,500 bpd.

  

The total fell well short of Baiji's original production capacity of 700,000 bpd, due to the deterioration of equipment over the past three decades when Iraq's resources were drained by war and trade sanctions.