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3 March 1999   
Oil-for-Food Background Information


 Briefing to the Security Council by Mr Benon V. Sevan
Executive Director of the Office of the Iraq Programme

Since Sunday my office has been in constant contact with Saybolt, the company retained to provide monitoring and other services in respect of Iraq's oil exports.

They advise that the flow of oil through the pipeline between Kirkuk and Ceyhan stopped at 18.39 (local time) on Sunday evening, 28 February.

The Saybolt independent inspection agents based at the metering station at Zakho near Iraq's border with Turkey were advised by their Iraqi counterparts that the pipeline had been shut down because of the loss of a communications repeater station about 125 kilometres away. It was considered unsafe to operate the pipeline without adequate communications.

However, there was an attempt that evening to operate the pipeline manually. This did not work and at 22.20 hours Sunday evening pumping stopped and has not resumed.

On 2 March, Saybolt agents were asked to visit Ain Zalah and inspect alleged missile damage to the communications facility there. Ain Zalah is about 40 kilometres from Zakho.

Saybolt has been in contact with senior officials of Iraq's Northern Oil Company which operates the pipeline. They have been advised that the NOC is working to bridge the communications gap caused by the loss of the repeater station. They hope to restore the communications chain between Kirkuk and Ceyhan and say that this could - possibly - be achieved some time later today.

Saybolt's agents have observed Iraqi technicians working on restoring the communications links.

IF -- and I would stress that there is an IF -- communications links are restored, Saybolt advise that pumping could resume almost immediately.

Up until now there has been NO interruption in the export of Iraqi oil via Ceyhan. Ships have continued to load oil as scheduled. As of this morning there was 2.38 million barrels in storage at Ceyhan with ships scheduled to load 1.8 million barrels starting tomorrow.

If the pipeline is back in operation within the coming 24 hours, Saybolt advise that the loading schedule at Ceyhan will continue with only minimal delays.

However, if the work underway is not successful and the NOC finds it has to replace damaged systems then the interruption could last some weeks - how long is impossible to estimate, as it would depend on the availability of spares and equipment.

As you know the pipeline to Ceyhan carries half of Iraq's oil exports. Currently Iraq is exporting 2 million barrels a day for an average price of around nine dollars a barrel.

I am making available to members of the Council reports from the Saybolt's agents on the extent of damage at the Repeater station and also at the communications facility at Ain Zalah which was damaged on Monday. 

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