Posted on 08/03/2003 5:32:02 PM PDT by cc2k
London, Iraq Press, July 29, 2003 – Several Iraqi officials are embroiled in murky contacts with foreign oil firms, MEES editor-in-chief Walid Khadouri has said.
In an interview with the London-based Azzaman newspaper, Khadouri, a respected worldwide authority on Middle East affairs and energy, said Iraqi politicians are in talks with foreign oil firms to "facilitate the garnering of investment contracts in the Iraqi oil sector.
"A number of current (Iraqi) officials are involved in attempts to gain commissions for facilitating the work of these companies …," the daily quoted Khadouri as saying.
As editor, Khadouri also oversees the productions of MEES, the authoritative Cyprus-based oil journal Middle East Economic Survey.
Khadouri told Azzaman, of which two separate editions are printed in Iraq, one in Baghdad and the other in Basra, that he was aware of the names of these officials but he would not like to "divulge them to the press."
Pressed to give further details, Khadouri said: "Iraqi politicians have established recently firms with the aim of getting in touch with these companies."
The Iraqi-born Khadouri advised oil firms to shun such contacts and conduct their negotiations through legitimate Iraqi channels.
The oil ministry is up and running and the U.S.-backed Iraqi Governing Council is expected to appoint a cabinet. It is not clear yet who will hold the oil portfolio.
The U.S.-led Coalition Provisional Authority has appointed Thamer al-Ghadhban to lead an advisory panel helping run Iraq's oil industry. He is assisted by Fadhel Othman who heads the State Oil Marketing Organization SOMO.
In the interview, Khadouri said any deals with Iraqi politicians "are bound to entail great risks to the Iraqi economy."
The oil industry in Iraq is under severe strain. Like most Iraqi infrastructure it has been plagued by looting and is currently struggling to push production to one million barrels a day, less than half of what the country churned out when the ousted leader Saddam Hussein was in power.
"The damage to the Iraqi oil sector is in the range of 900 million dollars," he said.
He said the figure does not include losses incurred due to the disruption of exports which earned Iraq 75 million dollars a day.
Iraq sits on the world's second largest reserves of oil. Officially, the country holds 114 billion barrels of crude.
But almost 90 percent of the country remains unexplored and Iraqi oil experts say there is huge potential for new and gigantic oil discoveries.
Khadouri said the oil ministry is short of cash and the U.S. civilian administration has so far stopped short of allocating money to it.
However, Khadouri was upbeat about future prospects.
"Despite all these problems and difficulties the oil sector is gradually recovering,"he said.
He said U.S. experts and army engineers have drawn up a plan which, if implemented, is supposed to boost production to 2.8 million barrels a day next April.
"But the implementation of this plan relies on several factors, namely the provision of security, electricity and money," Khadouri said.
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Any corruption in the Iraqi provisional government now would be pounced on by the Baathist allies in the American media as evidence of "failures" on the part of the U.S. military and civilian adminstrators in Iraq.
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