Tuesday, December 1, 2009

Iraq Still Doesn’t Have Meters On Oil Industry

As reported before, Iraq’s oil production and exports have fluctuated up and down since the U.S. invasion in 2003. In 2009 Iraq has averaged 2.28 million barrels a day in overall production, and 1.83 million barrels in exports. Those are only estimates however by the Oil Ministry because hardly any of the industry has meters to get accurate numbers. In July 2009 the Board of Supreme Audit, one of three anti-corruption agencies in Iraq, reported the following about recording the Ministry’s production:

• Only 2 of the 34 meters installed at 21 sites run by the North Oil Company were functioning correctly

• North Oil Company said that by end of 2009 it would have meters installed on all of its facilities

• Maysan Oil Company has no meters

• South Refinery Company has no meters

• Dhi Qar refinery uses a depth bar rather than meters

• 59 meters are required for the southern Iraqi facilities, but there are only 4 orders currently in progress, and no credit to purchase the rest

The lack of meters not only means the Oil Ministry has no real numbers on its production, but also allows large smuggling to occur. A 2008 audit of the Ministry for example, found 698,000 barrels of crude missing that were believed to have been stolen, and the Ministry recorded 6 million barrels less than the South Oil Company claimed it produced.

SOURCES

Special Inspector General for Iraq Reconstruction, “Quarterly Report to the United States Congress,” 10/30/09

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