$ 50 billion for rehabilitating the oil and electricity sectors in Iraq

The Washington Post published a report, on Sunday, highlights the energy situation in Iraq, noting that Iraq is still far from achieving its targets in the oil and electricity sectors, and that these sectors need about $50 billion to meet the demand in the country, according to analysts and officials.

The paper says that since the American invasion of Iraq in 2003, Bush administration focused most of its spending on oil and electricity, from the amount of 44.5 billion dollars appropriated for the reconstruction plan. Now, with the approaching end of the reconstruction phase, led by the United States, Iraq will need to spend an additional $ 27 billion for the electric system, and from 20 to 30 billion dollars for oil infrastructure, according to estimates of the government Accounting Office collected from American and Iraqi officials.

Even with the provision of funding, according to the newspaper, the Accounting Office noted that the work will take until the year 2015 to enable Iraq to produce six million barrels of oil per day, and provide sufficient quantities of electricity to meet the demand.

The newspaper reported that a military general of the military engineering unit says that it is possible to provide sufficient quantities of electricity as soon as possible by the year 2010 or 2013.

Stuart Bowen, the American General Inspector of reconstructing Iraq, and in charge of detecting waste, fraud and corruption worth tens of millions of dollars, said that the “American money was devoted to operate these industries and qualify them,” adding that “we are working in dilapidated sectors, and it is still a long way to go to reach to what we want.”

The newspaper indicated that a former high-ranking official at the Pentagon was working on rebuilding the oil and electricity sectors talked more openly saying, provided anonymity, that “people say that the money was to build the country, but was merely an initial payment,” saying that “that money was never enough to address what is in these sectors. It was just a help.”

The newspaper said that if these problems were not specified, it would be difficult to build a strong economy and develop the living standards, which would lead to the loss of people’s confidence in government.

The newspaper continues by saying that oil and electricity industries are the most important ones in Iraq and both depend heavily on each other. Iraq imports what is worth about two billion dollars of oil products per year. Oil exports constitute 90% of the proceeds of the Iraqi government, but oil production is paralyzed without the availability of sufficient electrical energy for the operation of refineries and pipelines transport. Electricity, in turn, can not be generated without fuel, which holds the majority of electric power stations in Iraq.

The paper says that American officials found the infrastructure of the country in worse condition than they had expected, especially after the severe damage in the 1990-1991 Gulf War and a decade of economic sanctions. Oil wells were not cleaned, and the apparatuses of the power stations were old and do not have spare parts. The paper recalls that one of the American auditors said that he had spent the entire day with 22 Iraqi electrical engineers explained to him proudly how they re-operated a generator using a piece of Pepsi machine.

The newspaper mentioned that Americans put $4 billion in more than 2600 projects to rehabilitate power plants, transmission lines and distribution networks. They also put $ 1.75 billion in developing the infrastructure of Iraqi oil. But the big problem is that, “armed groups regularly launch attacks on electrical and oil installations.”

Analysts say that Iraq needs to invest money in the infrastructure of the oil pumping and treatment, and the modernization and maintenance of equipment, as well as in training of workers in the fields of electricity generation and oil refineries.”

The newspaper quoted Brigadier General Michael Walsh, the general command of the military engineering battalion, brigade Gulf region, saying via a telephone call from Baghdad, “our work here was to create the infrastructure, and all what we did over the past four years was enough for a starting point. Now, the Iraqi government must continue our work.”