- The Washington Times - Friday, May 23, 2003

BAGHDAD — With the U.N. Security Council decision to end 13 years of sanctions, Iraq could begin to export oil on its own terms in as little as two to three weeks.

But it could take two years for the mighty oil exporter to reach the prewar capacity of only a few months ago.

The U.S. adviser to Iraq’s oil ministry, Philip J. Carroll, said in an interview last weekend that the government’s oil marketing agency would be able to solicit contracts immediately after the U.N. restrictions are discontinued.

“The State Oil Marketing Organization would be in a position to make tenders tomorrow,” Mr. Carroll said. “Then, five days to give prospective buyers the opportunity to make bids. Another three days for SOMO to evaluate bids … and then select who they will negotiate specific terms and conditions with.”

The oil could be flowing within three weeks, he said, to buyers who are willing to provide their own tankers.

Mohammed al-Juburi, the new director of SOMO, told Agence France-Presse yesterday that Iraq has 8 million to 9 million barrels in storage in Ceyhan, Turkey, ready to be sold immediately.

Mr. Carroll indicated last week that Iraq might choose not to rejoin the OPEC cartel if membership hobbles the country’s ability to export as much oil as it can produce.

But Iraqi oil ministry officials have since said they are committed to taking their place in the organization they helped found. It is not clear whether Iraq will send representatives to the cartel’s next meeting, to be held in Qatar in June.

Mr. Carroll, a former head of the U.S. subsidiary of Royal Dutch Shell, said it would take as long as two years for Iraq to reach its prewar pumping capacity of roughly 2 million barrels per day.

The country’s oil infrastructure has suffered from a decade of poor maintenance and underinvestment, compounded by a month of increasingly sophisticated looting, he said.

“Of course, there is a degree of neglect, with the sanctions and the period of serious underinvestment,” he said. “But the people working in Iraq’s refineries and oil fields have done their absolute best to maintain the equipment in operable condition.”

In the weeks since the war, well-organized thieves have tried to sabotage some wells and steal sophisticated equipment from refineries and pumping stations.

“They were stealing cranes and trucks, and using that to literally steal other valuable equipment like engines and gauges,” Mr. Carroll said. “That caused a significant impairment of the system, and [the equipment] will have to be replaced or repaired.”

The oil ministry’s priority is to quickly ramp up production capabilities to meet Iraq’s domestic needs.

Iraq, which is believed to have the second-largest oil reserves on earth, has been paralyzed since the war’s end by an acute shortage of fuel and liquefied natural gas. The crisis has forced the coalition to import gas from Saudi Arabia, Turkey and Kuwait, and suffer the wrath of Iraqi drivers forced to wait for hours in gas lines.

The Security Council resolution — sponsored by the United States, Britain and Spain — formally ends the sanctions imposed after Iraq invaded Kuwait in 1990, allowing Iraq to sell oil freely at market prices.

The resolution, which formally recognizes the United States and Britain as occupying powers under legal conventions, also phases out during the next six months the 7-year-old oil-for-food program, which had given council members the right to vet all Iraq’s imports.

The resolution also protects coalition officials from lawsuits related to the sale of Iraq’s oil until an “internationally recognized representative government” is in place.

Oil funds will be managed by the coalition and Iraqi oil ministry officials, to the chagrin of the political groups vying for a meaty role in creating that representative government.

Washington was also compelled to allow U.N. officials seats on the board that will monitor and spend those funds, a concession to pressure from Britain and others on the Security Council.

Meanwhile, in Washington yesterday the Defense Department identified four Marines killed in a helicopter crash Monday in Iraq as Capt. Andrew David Lamont, 31, of Eureka, Calif.; Lance Cpl. Jason William Moore, 21, of San Marcos, Calif.; 1st Lt. Timothy Louis Ryan, 30, of Aurora, Ill., and Staff Sgt. Aaron Dean White, 27, of Shawnee, Okla.

They died when their CH-46 “Sea Knight” helicopter went down in a canal near Hillah about 62 miles south of Baghdad in what defense officials said was apparently an accident.

Another Marine, Sgt. Kirk Allen Straseskie, 23, of Beaver Dam, Wisc., drowned while trying to save the helicopter crew.

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