US plans for Iraqi oil output under threat

It will take a year for Iraq’s oil industry to be fully restored to achieve its pre-war performance, says an American-led taskforce.

However, members of the US Army Corps of Engineers (USACE) fear their plans will be set back by the work of resistance fighters and looters.

USACE delivered its news on Monday after a strategy meeting charting production, export and rehabilitation goals for the next 12 months.

“We expect that in a year Iraq will be able to produce at pre-war levels,” the USACE’s Steve Wright, chief spokesman of the Restore Iraq Oil Task Force said.

Wright, who attended the talks, said he was confident that pre-war levels could be restored in a year but said that timetable could be undermined by sabotage.

Since the fall of Saddam Hussein in April, it is believed that Iraqis resisting the US occupation have taken aim at the country’s oil industry.

But Iraqi oil ministry officials have expressed serious doubt that Baghdad can meet its mid-July plan to restart exports from the oilfields.

Iraq’s US-appointed de facto oil minister Thamir Ghadhban has said he expects output to reach two million barrels per day (bpd) by the end of the year.

Iraqi oil officials put current production at 800,000 bpd and state that it will not increase much unless sabotage and looting is stamped out.

Wright, however added that Iraq’s production capacity would soon hit 500,000 bpd of crude oil in the north and 880,000 barrels per day in the south.

US soldiers stand next to a fire on the main oil pipeline from the Kirkuk oilfields in northern Iraq

Initially, Iraq had planned to resume exports of about a million bpd in mid-July, but it has missed several production and export targets.

Baghdad is struggling to revive exports from oilfields. Its oil sales after the war were made through tenders from storage.

After the US-led war on Iraq that toppled Saddam in April, Iraqis were permitted to go on a looting rampage.

But potential damage to the oil industry – crucial for Iraq’s economy and reconstruction – raised the most financial concerns.

Several blasts have hit Iraq’s key export pipeline to Turkey in the north.

Wright said the Iraq-Turkey pipeline had been nearly repaired but work suffered another setback after a recent explosion.

USACE engineers and Iraqi oil industry experts are responsible for repairing facilities built in the 1970s. Wright said they were aiming to revive them, not replace them.