Repeated pipeline sabotage costs "fortune" in oil riches

By The Washington Post and The Associated Press

NABIL AL JURANI / AP Workers flank a fire after saboteurs Sunday blew up a pipeline in al-Radgha, 30 miles southwest of Basra, Iraq. Insurgents' attacks on Iraq's oil industry are aimed at undermining reconstruction efforts.

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Five feeder pipelines in the southern Rumaila oil fields were attacked Sunday, immediately shutting down a pumping station in the town of Zubair and forcing officials to use reserves from storage tanks, said former Oil Minister Ibrahim Bahr Uloum.

He said he believed the southern refineries were stopped and likely to suspend their exports for at least a week to repair the pipelines.

"We are losing a fortune because of this sabotage," Bahr Uloum said.

The Associated Press quoted the governor of the southern port city of Basra, Hassan Rashid, as saying exports from the south had stopped completely.

But an unnamed official with the state-run South Oil Co. told The Washington Post that oil flow in the south continued unabated.

Iraq's other export avenue, a northern pipeline to the Turkish Mediterranean port of Ceyhan, carried no oil yesterday, according to an oil official there.

The confusion over the oil flow illustrated the degree of chaos in the Iraqi oil industry, which has suffered from frequent attacks and fluctuations in production.

"There are rumors that it's been turned off. What we know is that it's been disrupted, and that's the point," said Walid Khadduri, an oil expert and editor of the Cyprus-based Middle East Economic Survey.

Iraq earns $60 million to $70 million a day from exports at current market prices, Khadduri said. He said that oil exports have been falling for days because of attacks.

Iraqi interim Prime Minister Ayad Allawi condemned the pipeline attacks, saying they were causing suffering for ordinary Iraqis.

"This is causing a great loss for the Iraqi people in terms of revenues, which could be used in the reconstruction of the country and to pay the people and get the economy back on track again," Allawi said on CNN yesterday.

Copyright © 2004 The Seattle Times Company

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