Under heavy guard, oil fields set to export crude

BABA GURGUR, Iraq — With security guards now deployed along Iraq’s export pipeline to the Mediterranean, crude from one of the country’s biggest oil fields could start flowing to overseas markets “in a matter of days,” a senior Iraqi oil official said.

Sabotage attacks forced the Oil Ministry last year to close the pipeline, one of its two main arteries to overseas markets, but repairs to the network are now almost complete. The North Oil Co., which pumps crude near the northern city of Kirkuk, could boost Iraq’s exports by up to 320,000 barrels a day — or about 20 percent — as soon as the Oil Ministry gives the order, said the company’s deputy general director, Manaa al-Obaydi.

Since the ouster of Saddam Hussein last April, Iraq has only been able to export crude from its southern oil fields. The suspension of exports from northern Iraq has limited the North Oil Co. to producing solely for domestic consumption.

The long-anticipated resumption of oil shipments from Kirkuk to the Turkish port of Ceyhan would unlock a trove of crude and put Iraq on course to surpass its prewar production of 2.5 million barrels a day. Iraq needs to maximize oil exports to pay for repairs and improvements to its shattered economy and to undergird its future political stability.

Initial shipments would be modest in size, but would have a big psychological impact, especially on the market for heating oil, said Peter Gignoux, an independent analyst based in London.

“The market needs it. North America has just been ravaged by staggered onslaughts of arctic air,” he said by phone from Aspen, Colo.

Iraq now pumps more than 2.3 million barrels a day. Its daily exports exceed 1.5 million barrels, almost all of them leaving from Iraq’s Basrah Oil Terminal in the Gulf. Once the pipeline to Turkey reopens, Iraq could rapidly increase its crude exports by as much as 20 percent, Mr. al-Obaydi said.

“The closure is not a forced closure. It’s not that I cannot export [and] therefore, I’m not exporting. I can export if the Ministry of Oil decides to do so,” he said at his company’s headquarters, 5 miles northwest of Kirkuk.

Security problems, which used to be the overwhelming reason for the pipeline’s closure, are now a minor issue thanks to the employment of thousands of specially trained guards.

British security firm Erinys International Ltd. has hired many of the guards from villages near the same sections of pipeline that saboteurs have bombed and strafed.

It won’t be long before north oil can export again. Shipments could restart within “a matter of weeks — a matter of days even,” Mr. al-Obaydi said in an interview.

Crude exports from Kirkuk to Ceyhan continued right until Saddam’s ouster on April 9, but the Iraqi-Turkish pipeline has remained shut to normal operations since then.

Until now, the pipeline has been an easy target for saboteurs keen to deprive Iraq of much-needed earnings. Although the pipeline lies mostly underground, a string of pumping stations and power lines mark its route, and a service road runs parallel to it.

“It doesn’t take much intelligence to discover where the pipeline is,” said Fouad al-Kadhimi, a former ministry engineer who managed the pipeline’s construction in the mid-1970s.

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