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Commerce returns to Iran-Iraq border river
by Staff Writers
Al-Nashwa, Iraq (AFP) Feb 7, 2012

Commercial traffic has resumed on the strategic Shatt al-Arab waterway after a three-decade break with the official opening of a port for oil giant Shell, an Iraqi official said on Tuesday.

Part of the 200-kilometre-long (120 miles) waterway forms a section of the border with Iran.

An unresolved boundary dispute was a major reason for the 1980-1988 war between Iraq and Iran that resulted in the waterway's closure.

"The Shatt al-Arab is reborn again after being closed for 31 years," Mehdi Badah Hussein, head of a joint committee to develop Majnoon oil field, told AFP at a ceremony to open the port.

"There are other harbours on the Shatt al-Arab, but commercially, this is the first time Iraq succeeded in turning the Shatt al-Arab into a maritime passage which will help in transporting heavy equipment," Hussein said.

Dia Khalil, an Iraqi engineer and joint committee member, told AFP the journey up the Shatt al-Arab to the new port is about 80 kilometres (50 miles), and that ships will pay customs fees in Umm Qasr to the south before heading to the new harbour.

A consortium of Anglo-Dutch oil giant Shell and Malaysia's Petronas signed a contract with Iraq in January 2010 to operate the enormous Majnoon field.

"We believe this is the first jetty harbour to bring in ships that can come from all over the world back off the river with heavy equipment in 31 years," Shell Majnoon general manager Ole Myklestad told AFP.

"This is very important," Myklestad said at the ceremony. "I hope that ships leaving this harbour in the future will also be carrying goods."

Myklestad said the first ship arrived at the harbour on January 5 and clarified that the port would not be used to export oil which is to be carried by pipeline.

"This is a happy day," said Khalaf Wadi, deputy manager of Iraq's Southern Oil Co, a partner with Shell and Petronas. "We are officially opening the first commercial jetty in the Shatt al-Arab since the start of the war with Iran."

The port's main function will be to facilitate the transportation of equipment to the massive Majnoon oil field.

But ordinance in the field, which was a major battleground during the eight-year war with Iran, poses a danger.

Simon Mawdslag, Shell's Explosive Remnants of War Coordinator, said "over 4,000 individual items of ordinance" have been located and removed from a roughly eight square kilometre (three square mile) area -- the only part cleared so far.

"These items are handed over to the Iraqi armed forces and their explosive ordinance disposal team. They actually do the destruction of the items," he said.

The Majnoon field was discovered in 1975 by Brazilian firm Petrobras but its work was interrupted in 1980 by the beginning of the Iran-Iraq war, after it had drilled 20 wells.

In 1990, French firm total negotiated a contract for the field but was unable to sign due to international sanctions after Saddam Hussein's Iraq invaded Kuwait in August of that year.

Oil sales account for the vast majority of Iraqi government income and around two-thirds of gross domestic product.

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Iran begins production in oil field shared with Iraq
Tehran (AFP) Feb 7, 2012 - Iran on Tuesday began preliminary production in the Yadavaran oil field in the southwest, shared with neighbouring Iraq, with the opening of a first well, the oil ministry's Shana news agency said.

Head of the Oil Engineering and Development Company, Naji Saadouni, said production would reach 20,000 barrels per day by mid-March, Shana reported.

Iran plans to increase the total production of the field to 180,000 barrels per day within three years, Shana said.

Sinopec, China's largest oil refining company, has been involved since 2007 in exploiting the Yadavaran oil field, estimated to hold 3.2 billion barrels of recoverable crude, as part of a contract worth 3.6 billion dollars.

Sinopec, like many other Chinese companies, was strongly criticised last year by Iran for delays in starting production in Yadavaran, which is already being exploited by Iraq.

China in recent years has signed contracts worth more than 40 billion dollars, following the withdrawal of Western companies in the face of economic sanctions against Iran.

However, analysts say that so far only a fraction of that investment has been realised, and Iran last year warned it would punish Chinese companies if they did not speed up the pace of implementation.

Iran, struggling to attract annual investment of nearly $50 billion to develop its oil and gas field capacity, decided last year to give priority to shared fields already being depleted by other countries.

Thus the Yadavaran and Azadegan oil fields, shared with Iraq, and the giant South Pars gas field, shared with Qatar, have been fast-tracked.

Iran is the second biggest producer in the Organisation of Petroleum Exporting Countries (OPEC) with 3.5 million barrels per day, 2.5 million of which are exported, bringing in up to $100 billion last year.

It also ranks second in the world in terms of natural gas reserves after Russia.


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Commercial traffic resumes on Shatt al-Arab
Al-Nashwa, Iraq (AFP) Feb 7, 2012
Commercial traffic has resumed on the strategic Shatt al-Arab waterway after 31 years, with the official opening of a port for oil giant Shell, an Iraqi official said on Tuesday. Part of the 200 kilometre (120 mile) long waterway forms a section of the border with Iran. An unresolved boundary dispute was a major reason cited by now-executed dictator Saddam Hussein for the 1980-88 war with Ir ... read more

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