By Eric Watkins
Middle East Correspondent
NICOSIA, June 16 -- Even as oil tankers are preparing to lift the first exports of Iraqi crude since the outbreak of the US-led war in March, organized sabotage continues to undermine efforts to restore the country's oil and gas production to prewar levels.
"We are currently producing just short of 600,000 b/d (of oil), which is probably about the domestic demand," Ambassador L. Paul Bremer, Washington's top administrator for Iraq, told the House Armed Services Committee last week by closed-circuit television from Baghdad.
"We will be ramping that production rate up to a level of about 1.5 million b/d by the end of the year, and maybe more. So we will be able to export a substantial amount of oil, even after we have depleted the last barrels. . .that are now in storage in the pipeline to Turkey, Bremer added.
Pipeline 'sabotage'
But even as Bremer spoke from Baghdad on Thursday, the Iraq-Turkey oil pipeline suffered two explosions that will hinder the country's export capacity, according to the US-appointed Iraqi Oil Minister Thamir Ghadhban.
"There is an incident in the pipeline somewhere near Baiji refinery. We are now assessing and evaluating the damage. I don't know exactly how it happened, and why it happened, but we will do our best to fix it.
"It will affect export capability. It is a pipeline and any incident in a pipeline would affect exports, but it can be repaired," Ghadhban told Reuters in an interview.
In Ankara, Turkish Foreign Minister Abdullah Gul said the pipeline had been sabotaged and an investigation was under way. But US Army spokesman Capt. John Morgan said the explosions appeared similar to previous accidents, and dismissed reports of deliberate bombing. The pipeline was still burning on Monday, reports said.
LPG plant damage
Bremer is well aware of acts of sabotage from Iraqi diehards that have hindered US efforts to restore the country's oil exports. He told Congressmen of destruction to Basra's South Gas LPG plant (SGLPG), which he visited last Wednesday. "It was a pure act of political sabotage, almost certainly, by elements of Baathists who want to show that the coalition is unable to run this country," Bremer said, adding, "we still face this kind of activity, and we need to defeat it."
SGLPG, which produces about 50% of Iraq's LPG, is not operational because of sabotage to equipment and a lack of adequate electricity. According to Jabbar Al Eaby, the facility's director, it was professionals who carried out the sabotage since they knew "exactly" how to most severely damage the plant's equipment.
Although enough electricity should be in place by Friday, the parts to repair the plant's damaged equipment will not be available until later. Al Eaby, who escorted Bremer through the SPLPG Wednesday, could not even estimate when the facility would be back online.
Oil deliveries continue
While the explosions along the Iraq-Turkey pipeline have already raised concerns over the continued security of the country's oil operations, whether from sabotage or operational defects, the blasts will not affect Iraq's first oil tender since the outbreak of the war.
Iraq's State Oil Marketing Organization (SOMO) last Thursday awarded 5.5 million bbl of Kirkuk crude to Spain's YPF-Repsol SA, Cepsa SA, Turkish refiner Tupras, and Italy's ENI SPA. SOMO also awarded 2 million bbl of Kirkuk crude to Total SA and a further 2 million bbl of Basra crude to ChevronTexaco Corp.
Oil shipments totaling 9.5 million bbl will be taken from stocks of some 9 million bbl of crude from Iraq's northern Kirkuk fields at the Turkish terminal of Ceyhan on the Mediterranean Sea and 2 million bbl of Basra Light lifted in the south—almost all of it pumped before the outbreak of war in March.
Shipping sources on Sunday said the 147,275 dwt tanker Sandra Tapias, owned by Spain's Tapias Naviera F. SA, will arrive at Ceyhan Friday to lift 1 million bbl of Iraqi oil, the first loading from Ceyhan since Mar. 20, when US air attacks commenced against targets in Baghdad.
The Iraq-Turkey pipeline, which has been idle since Apr. 10, when Kurdish forces allied to the US took over the town of Kirkuk, is expected to resume operations after a few vessels are loaded and space becomes available, assuming there are no further accidents or incidents along the line.
