The Truth behind Oil Theft in Basra

By Salam Zidane for Al Monitor. Any opinions expressed here are those of the author and do not necessarily reflect the views of Iraq Business News.

On Jan. 15, Iraqi members of parliament, including Sadeq al-Mhanna from the ruling National Alliance, revealed that they are in possession of documents that prove the theft of 300,000 barrels of Basra oil by officials who modified the counters.

A Jan. 25 statement issued by the Oil Ministry in response to the allegation said, “Iraq adopts the best international standards in exporting oil via export ports. The process is supervised by local and international agencies.”

The statement added that the ministry “employs an advanced electronic counters system calibrated according to international standards. The system is certified and approved by Intertek, an international testing company that supervises loading procedures, as well as the inspection and approval of exported quantities via the counters.”

Up to 98% of the Iraqi national budget relies on the oil produced in Basra, especially after Kurdistan refused to hand over its production to the State Organization for Marketing of Oil (SOMO) due to disputes over Kurdistan’s 17% share of the federal budget.

Iraq exports Basra oil via two offshore ports, Basra and Khor al-Amaya. The process of loading the crude oil carrier usually takes 48-56 hours in the presence of representatives from the client company and SOMO and is supervised by Intertek.

Mhanna told Al-Monitor, “The National Security Service addressed a letter to the Ministry of Oil confirming the theft of 100,000-300,000 barrels of Basra oil per day. Furthermore, the ministry’s periodic meetings with the international testing company have underlined this huge squander. Iraq is losing around $20 million daily due the wastage in oil exports, which amounts to annual losses of $7 billion.”

Comments are closed.