Iraq Oil Report

Plus:
*Port takeover and blow up the smugglers
*Iraq oil production not up yet after Basra
*Maliki’s 7-point plan
*British Navy helping stand up Iraqi Navy
*DNO up on export deal
*Pelosi plays the blame Iraqis game

Negotiators are hammering out a new draft Iraq oil law after previous versions stalled, and as Parliament is moving forward on two new laws, one reconstituting the state oil company and another cracking down on oil and fuel smuggling, Ben Lando reports for United Press International.

“Shortly, we’ll see a new draft which there is more common ground,” said Abdul-Hadi al-Hasani, deputy chair of the Iraqi Parliament’s Oil, Gas and Natural Resources Committee, which has already seen four versions of a draft oil law. The latest draft is based on “good dialogue” between the central and Kurdistan region governments, he said, and the Council of Ministers will soon approve it and send it to his committee.

A new oil law has officially been in the works for two years, and sources United Press International spoke to both echoed Hasani’s optimism as well as said a divide over the law remains too large.

The law is one piece in a four-part package of legislation aimed at modernizing Iraq’s oil sector.

Another is a law re-establishing the Iraqi National Oil Co., the state company dissolved as Saddam Hussein consolidated power over Iraq’s oil via the Oil Ministry. Hasani told UPI in a telephone interview from Baghdad that the INOC law has been passed from the Council to his committee.

“We are going to discuss it next week,” he said, calling it “one step in the right direction.”

Hasani said INOC would incorporate all state companies operating in the oil and gas sector.

The remaining legislation — a law reorganizing the role of the Ministry of Oil and a revenue-sharing law, which decides how oil sales are captured and redistributed — both remain with the Council of Ministers.

“We’ve been asking for it and we’re waiting on it,” Hasani said. “These two laws if they come in will really prepare good ground to be able to pass the hydrocarbons law, which everybody is waiting for.” …

Hasani said a new law targeting smugglers has already received a first reading. It comes after last week’s Iraqi Security Forces siege on Basra and still ongoing but smaller targeting of smuggling operations in the country’s oil capital, as well as black-market clouds that hang over Iraq’s largest oil refinery, Baiji, in the north. …

The New Sabah newspaper reports Iraqi Security Forces are “to sink all the boats that are used for smuggling and empty the public buildings and lands occupied by smugglers in no more than one month.”

The Addustour newspaper reports the Iraqi army has taken control over security and control of the Khor al-Zubair and Umm Qasr ports.

Click HERE to read the entire story.

Iraq has yet to fully restore 100,000 barrels per day (bpd) of oil output that has been shut in since a bomb attack on a pipeline last Thursday, an Iraqi oil official told Reuters. “Output in the area is lower than what it should be,” the official said. “I don’t know when it will be restored.”

Iraqi Prime Minister Nouri al-Maliki outlined a seven-point plan for Basra following operations pitting Iraqi security forces against Shiite militias, UPI reports.

The British Royal Navy have been training Iraqi marines to help protect key Iraqi oil facilities in the the Persian Gulf. Footage filmed by Britain’s Sky News show Iraqi marines performing military drills on al-Basra and Khor al-Amaya oil terminals, 14 miles from the country’s coast.

Norwegian oil producer DNO said it is confident it will win an important oil export licence in Iraq some time in 2008, CEO Helge Eide told Thomson Financial.

The status and development of DNO in Iraqi Kurdistan can be seen in this newly published report.

The visit of a Kurdish delegation either representing the Kurdistan Regional Government or the Kurdistan Democracy Party (KDP) is not imminent, Kurdish official sources reported Wednesday, according to The New Anatolian.

Military units pay an average of $3.23 a gallon for gasoline, diesel and jet fuel, using about $88 a day per service member in Iraq, Anne Flaherty reports for The Associated Press. A penny or two increase in the price of fuel can add millions of dollars to U.S. costs. The U.S. military, through its Defense Energy Support Center, buys fuel on the open market, paying from $1.99 a gallon to as much as $5.30 a gallon under contracts with private and government-owned oil companies. The center then sets a fixed rate for military units, currently $3.51 a gallon for diesel, $3.15 for gasoline, $3.04 for jet fuel and $13.61 for avgas, a high-octane fuel used mostly in unmanned aerial vehicles.

If Shiite militias controlling southern Iraq rose against U.S. forces in the event of a U.S. attack on Iran, they could have the capability to cut U.S. land supply lines to the U.S. Army currently operating in central Iraq, William S. Lind writes for UPI. If that happened, U.S. Army forces in Iraq would quickly begin to run out of supplies, especially petroleum, oils and lubricants, of which they consume a vast amount. Once they are largely immobilized by lack of fuel, and the region gets some bad weather that keeps U.S. aircraft grounded or at least blind, Iran sends two to four regular army armor and mechanized divisions across the border.

Blame the Iraqis, again – House Speaker Rep. Nancy Pelosi spouts out the continued ignorance of the “shoes untied” Democratic Party, complaining about the cost of the war on U.S. taxpayers and saying Iraqis “haven’t paid for anything,” the Talk Radio News Service reports.

Notwithstanding the fact that the power of the purse lies with Congress and Ms. Pelosi’s party is in the majority, Iraqis are actually paying more this year than the United States…well, just read UPI’s Ben Lando’s recent article explaining what Iraqi funds are going to and how members of the Democratic Party are pretty much clueless on the Iraq facts.

Security, Society & Politics

The chief of the U.N. Mission in Iraq and other representatives met with Iraqi officials to discuss recommendations for eight provincial election officials, UPI reports.

Read Iraq’s editorial pages: The Iraq Press Roundup, by UPI’s Hiba Dawood.

Iraqi Economics

World Trade Organization Working Party members, on 2 April 2008, supported Iraq’s rapid accession to the WTO and argued it would contribute to the country’s integration into the world economy. Iraq’s Trade Minister, H. E. Dr. Al-Sudani, stated that Iraq was determined to overcome the country’s difficult circumstances to move forward on the accession process and added that Iraq’s membership would represent a significant addition to the international community.

Official source at ministry of water resources said that general department of dams in the ministry has prepared a list including 13 big and small dams that would be erected during next years in the north and south of the country, al-Sabaah reports.

Technical and engineering staff in Wassit electric department started rehabilitating the damaged generators and the cables which resulted from the last attacks in the past week, al-Sabaah reports.
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