U.S. reluctant to work on Iraqi oil reservoirs

Arab suspicion an obstacle to proceeding with repairs

November 30, 2003|By NEW YORK TIMES NEWS SERVICE

As the Bush administration spends hundreds of millions of dollars to repair the pipes and pumps above ground that carry Iraq's oil, it has not addressed serious problems with Iraq's underground oil reservoirs, which American and Iraqi experts say could severely limit the amount of oil those fields produce.

In northern Iraq, the large but aging Kirkuk field suffers from too much water seeping into its oil deposits, the experts say, and similar problems are evident in the oil fields in southern Iraq.

Experts familiar with Iraqi's oil industry have said that years of poor management have damaged the fields, and some warn that the drive to rapidly return the fields to prewar capacity runs the risk of reducing their productivity in the long run.

"We are losing a lot of oil," said Issam al-Chalabi, Iraq's former oil minister. He said it "is the consensus of all the petroleum engineers" involved in the Iraqi industry that maximizing oil production may be detrimental to the reservoirs.

A 2000 United Nations report on the Kirkuk field said that "the possibility of irreversible damage to the reservoir of this supergiant field is now imminent." U.S. officials acknowledge the underground problems, but figuring out how to address them is a quandary for the United States.

The Bush administration and the Iraqis are banking on oil revenue to help pay for Iraq's reconstruction, and U.S. officials say that aggressively managing the reservoirs is crucial to keeping oil and revenue flowing. But so far, U.S. officials have steered clear of delving below ground, partly, they say, out of fear of adding to suspicion in the Arab world that the United States invaded Iraq to control its oil.

The above-ground vs. below-ground debate also raises the question of whether the U.S.-led reconstruction effort is intended just to repair damage from the war or to improve conditions beyond what they were before the invasion.

When Wayne Kelley, a Texas oil engineer, and other experts asked about attending to Iraq's oil reservoirs during a government conference for contractors in July, Army Corps of Engineers officials said their mission was restoring war-damaged facilities, not "redeveloping the oil fields," according to a transcript of the meeting.

But in a recent interview, Rob McKee, a former top executive with ConocoPhillips of Houston, who took over in October as senior oil adviser for the Coalition Provisional Authority in Baghdad, said he believed the underground reservoirs needed attention.

"It's bad," McKee said in a telephone interview, "but it will not be catastrophic." Still, he said, it is crucial to collect data, and do engineering on the problem.

The Army Corps of Engineers has set aside $1.7 billion for maintaining Iraq's oil supply, and the money has been split between paying for imported fuel and fixing the pipes, pumps and transfer stations, officials say. About $2 billion has been approved for oil infrastructure repairs next year.

But managing the reservoirs could be a long and expensive process involving complicated computer simulation and changes in extraction techniques.

This work is important, oil experts say, because while Iraq sits on one of the world's largest deposits, most of its oil is being drawn from two older fields, Rumaila in the south and Kirkuk in the north.

The complications in Iraq are common in aging fields, whose management is a balance of geology, physics and economics.

Petroleum engineers often compare oil reservoirs to a bottle of soda, which has a high level of energy when full but loses energy as it is depleted. Engineers use a variety of methods to maintain the pressure needed to bring the oil to the surface, including injection of gas or water into the fields.

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.