PIPELINE SABOTAGE HITS OIL HOPES FOR IRAQ Carola Hoyos
Iraq will have to rely almost entirely on its southern oil fields to generate export revenues this year, industry experts say.
The country's northern pipeline, which until the start of the US-led war pumped 1m barrels a day of oil to the Turkish port of Ceyhan, has been crippled by acts of sabotage. An explosion this weekend was the fourth since it resumed pumping last month after a four-month hiatus.
"There is no doubt that Iraq has the resource potential and quality to double its pre-war production levels of 2.5m b/d, but achieving this is subject to huge investments and major uncertainties," Wood Mackenzie, the Edinburgh-based oil consultant, said in a recent report.
Although Iraq's exports have risen recently to as much as 800,000 b/d on some days, as production from the southern Rumaila fields has improved, they averaged only 645,000 b/d in August. Iraq's northern Kirkuk fields are producing to meet local demand. Wood Mackenzie calculates that, in the future, Iraq's oil revenue could peak at anywhere between $27bn (£17bn) and $50bn a year. But existing revenue is little more than $6bn.
US officials had originally counted on Iraqi oil revenues to finance their reconstruction efforts. But the difficulties of exporting oil are increasing costs.
With the Pentagon running out of the $79bn in cash appropriated by Congress in April to pay for war and reconstruction, the Bush administration is expected to make another request soon.
Paul Bremer, the US administrator in Iraq, has said he hoped oil exports could reach pre-war levels by October 2004. But increased security risks have led oil executives to postpone plans to open offices in Iraq.
Financial Times; Sep 02, 2003
Keith Hudson, 6 Upper Camden Place, Bath, England, <www.evolutionary-economics.org>
_______________________________________________ Futurework mailing list [EMAIL PROTECTED] http://scribe.uwaterloo.ca/mailman/listinfo/futurework
