Iraq: UNOIP Weekly Update 19 Feb 2003

Situation Report
Originally published
Iraqi Oil Exports Total 11.4 million Barrels for Week
Iraqi exports under the Oil-for-Food Programme totaled 11.4 million barrels for the week (8-14 February) - an average of about 1.6 million barrels per day.

There were 8 loadings from the authorized terminals: four from the Iraqi oil platform at Mina al-Bakr (7.3 million barrels) and four from the Turkish Mediterranean oil terminal at Ceyhan (4.1 million barrels). These are the only outlets for Iraqi oil exports allowed under the Oil-for-Food Programme.

Total exports for the week (11.4 million barrels) generated estimated revenue of €295 million (euros) or $315 million, at current prices and rates of exchange. The average price of Iraqi crude for the reporting period was approximately €25.95 or $27.80 per barrel.

There were no new oil purchase contracts for approval by UN oil overseers for the week. The current total of approved contracts is 121, covering 312 million barrels of oil. Estimated revenue generated from the beginning of phase Xlll (5 December 2002 - 3 June 2003) at the current rate of exchange, stands at $3.2 billion for 118.6 million barrels of oil.

Contract Approvals

Of a total 5,732 contracts for humanitarian supplies worth $10.9 billion processed by the United Nations Secretariat under the Goods Review List (GRL) and new procedures under Security Council resolution 1409 (2002), the Office of the Iraq Programme has approved 4,282 contracts worth about $6.4 billion (58.3 per cent in terms of value) after assessment by the United Nations Monitoring, Verification and Inspection Commission (UNMOVIC) and the International Atomic Energy Agency (IAEA) that they do not contain items on the Goods Review List.

Approvals include 1,079 contracts worth more than $1.9 billion that had previously been on hold by the Security Council's 661 Sanctions Committee. These have now been reviewed by UNMOVIC/IAEA under para 18 of the procedures of resolution 1409 (2002).

Goods Review List

Of the total contracts, 972 worth about $2.9 billion (26.5 per cent in terms of value) are on GRL Non Compliant status. UNMOVIC and IAEA will require additional technical information from suppliers to enable final assessments.

So far, 270 contracts worth $973.9 million have been found by UNMOVIC/IAEA to contain one or more GRL items. Of these, 134 contracts worth $294.6 million have been reviewed by the Security Council's 661 Sanctions Committee, of which, 30 contracts worth $15.0 million have been approved. Thirty six, worth $44.8 million, have lapsed because the suppliers have not submitted a petition within 30 working days of the denial. Twenty four of the 270 contracts, worth $56.9 million, have been rejected because of a "high risk of diversion to military use." An additional 40 contracts worth $176.4 million have been denied approval by the 661 Committee, pending appeal.

Contracts containing GRL items represent 8.9 per cent, in terms of value, of all applications processed by the UN experts so far.

Humanitarian revenue shortfall

Due to a cumulative oil revenue shortfall dating from phase VIII (9 June - 5 December 2000) through phase Xll of the programme, 2,453 UN-approved humanitarian supply contracts worth some $4.6 billion, currently lack funds. The sectors affected by the revenue shortfall are: agriculture ($691 million); food handling ($689 million); housing ($599 million); electricity ($475 million); food ($467 million); telecommunications and transportation ($452 million); water and sanitation ($413 million); education ($390 million); health ($349 million).

Oil-for-Food Programme

The oil-for-food programme was established by the Security Council on 14 April 1995. Some 3.3 billion barrels of Iraqi oil valued at about $63 billion have been exported under the programme since December 1996. Of this amount, 72 per cent of the total has been allocated towards humanitarian needs nationwide since December 2000. The balance goes to: Gulf War reparations through a Compensation Fund (25 per cent since December 2000); UN administrative and operational costs for the programme (2.2 per cent) and costs for the weapons inspection programme (0.8 per cent).

Since December 1996 about $43 billion worth of humanitarian supplies, including $3.7 billion worth of oil spare parts, have been approved by the 661 Sanctions Committee and the Office of the Iraq Programme. Of this amount, almost $26.6 billion worth of humanitarian supplies and equipment have been delivered to Iraq under the Oil-for-Food Programme, including $1.6 billion worth of oil industry spare parts and equipment. An additional $10.1 billion worth of supplies are currently in the production and delivery pipeline.

Additional information is available from the website of the Office of the Iraq Programme. For further information please contact Ian Steele email: