GENEVA (AP) -- Despite setbacks from sabotage and looting, Iraq's oil ministry plans to develop four new oil fields in 2004 and restore the country's daily crude production to its prewar level of 2.8 million barrels by March, the ministry's chief executive said Monday.
The new fields would add 340,000 barrels to Iraq's daily production and contribute to the ministry's long-term goal of pumping 6 million barrels a day by 2014, chief executive Thamir al-Ghadban said.
Iraq has the world's second-largest proven crude reserves, and growth in its oil exports is essential to reviving an economy gutted by wars and more than 12 years of U.N. economic sanctions, imposed after Saddam Hussein invaded Kuwait in 1990.
Al-Ghadban told potential investors Iraq's oil industry is making a strong recovery and he believes Iraq should be able to reach its long-term production target much sooner than 2014.
However, another senior Iraqi oil official took a more conservative view of the pace of recovery. Falah al-Khawaja, an expert in the oil ministry's economics and finance directorate, said Iraq's export pipeline to the Mediterranean port of Ceyhan, Turkey, must be repaired and protected against further acts of sabotage if Iraq is to sustain an output volume of 2.8 million barrels a day by March.
The pipeline operated briefly in August before one of several attacks on facilities in northern Iraq forced the Iraqis to shut it down for repairs. Iraq could today be exporting 500,000 more barrels daily if this pipeline from the northern city of Kirkuk were operating, al-Khawaja told reporters.
Exports have also suffered from unreliable electricity supplies and smuggling of crude stolen from southern pipelines. Iraq might need until next summer to restore sustainable production to what it was on the eve of the U.S.-led invasion.
"The key word is 'sustainable,"' he said.
Theft and vandalism slashed Iraq's production capacity by a massive 1.9 million barrels a day during the first weeks after the war.
"In April, we found ourselves in the middle of nowhere -- a standstill of all oil operations, continuous destruction, dismantling and looting of oil and gas production facilities and various utilities, equipment, vehicles, stores and offices," al-Ghadban told more than 100 oil executives meeting at a Geneva hotel.
The industry is recovering, he argued, in spite of sporadic attacks such as those that have forced the closure of Iraq's export pipeline to Turkey. Even though all crude exports must now leave from the Persian Gulf terminal of Mina al-Bakr, Iraq's daily oil shipments have surged from an average of 265,000 barrels in June to 982,000 barrels in September.
Iraq is unusual as a Middle East producer for its large number of identified but untapped oil fields. Martin Purvis, an oil analyst at Wood Mackenzie Consultants in Edinburgh, Scotland, argued Iraq could become the No. 3 crude exporter after Saudi Arabia and Russia if it worked with international oil companies to develop these virgin deposits.
"The ministry looks positively forward to strengthening its relations with the international oil industry," al-Ghadban said.
Some companies have already scouted possible opportunities inside Iraq, but many more appear to be holding back until they see an improvement in security against attacks by militants opposed to American troops and the U.S.-backed Iraqi Governing Council.
"I think that is the biggest issue at the moment," said Jan Buiting, an adviser to oil firm ASI Global SA of Lausanne, Switzerland. "We would like to go in there, but we cannot see how we can make our staff safe."
Al-Khawaja refused to identify the companies Iraq is engaging to produce at the Khurmala and Hemrine oil fields in northern Iraq and the Subba and Luhais fields in the south.
Longer-term, Iraq plans to build a second strategic pipeline to shunt oil between its northern and southern export routes, and it aims to rebuild a storage tank facility on the Faw peninsula near Mina al-Bakr, al-Khawaja said. The tank farm was one of the largest in the world before it was destroyed during the 1980s war with Iran.
