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19 March 2002
Oil-for-Food Background Information


Weekly Update

(9 - 15 March 2002)


With only one loading from Ceyhan terminal on 10 March for 2.1 million barrels of oil, Iraq’s oil exports under the United Nations oil-for-food programme plummeted to 11.4 million barrels in the week 9 – 15 March 2002.  There were six loadings from the second authorized loading terminal of Mina al-Bakr, with 9.3 million barrels of oil.  Estimated revenue generated from the exports amounted to €280 million (euros) or $245 million, at current prices and rate of exchange.  The average price of Iraqi crude oil was approximately €24.35 or $21.35 per barrel. 

So far in current phase XI of the programme, which ends on 29 May 2002, Iraq has exported 167.4 million barrels of oil for an estimated revenue of about €3.3 billion or $3 billion.  There are 135 approved oil purchase contracts, including one new contract approved by the United Nations oil overseers during the week in review.  The approved contracts cover 327 million barrels of oil, of which 186 million barrels are for Basrah Light and 141 million barrels for Kirkuk crude.   

Iraqi oil exports of some 2.97 billion barrels have netted approximately $38.6 billion and €16 billion ($14 billion) in revenue, since the beginning of the programme on 10 December 1996.  Since December 2000, 72 per cent of the oil revenue goes to funding the humanitarian programme in Iraq, 59 per cent of which is for the 15 central and southern governorates and 13 per cent for the three northern governorates.  Previously, 66 per cent of the oil revenue was earmarked for the humanitarian programme (53 per cent for the centre and south and 13 per cent for the northern governorates), while the Compensation Fund received 30 per cent.  Also from the total revenue, 2.2 per cent goes towards covering the United Nations costs for administering the programme and approximately 0.8 per cent for the administration of the United Nations Monitoring, Verification and Inspection Commission (UNMOVIC), with the Compensation Fund now receiving 25 per cent.

To date, humanitarian supply contracts worth some $32.7 billion have been both approved by the Security Council’s 661 sanction committee and “fast-tracked” by the Office of the Iraq Programme (OIP), including $2.9 billion worth of contracts for oil industry spare parts and equipment.  Some $19.9 billion worth of humanitarian supplies and equipment have been delivered to Iraq, including $1.2 billion worth of oil industry equipment, while another $11.1 billion worth of humanitarian supplies and $1.7 billion worth of oil industry equipment are in the production and delivery pipeline.

During the week, the 661 Committee released from hold 25 contracts, worth $40.6 million, while placing on hold 28 new contracts, worth $96 million.  The total value of “holds” stood at over $5.3 billion, covering 2,088 contracts for the purchase of various humanitarian supplies and equipment, of which 1,433 contracts, valued at about $4.6 billion, were for humanitarian supplies and 655 contracts, worth $710 million, were for oil industry spare parts and equipment. 

In the category of “inactive holds”, there were 230 contracts, worth  $436 million, for which the suppliers had not provided the additional technical information requested by the “holding” Committee member(s) in over 60 days.  However, in the category of “active holds”, there were also 680 contracts, worth over $2 billion, for which although the suppliers had provided the requested information over 60 days ago, the “holding” Committee member(s) had not yet made a final decision.

About $1.7 billion and €288 million in unused funds were still available in the United Nations Iraq Account.  However, these funds have been set aside for oil spare parts and equipment and for the purchase of humanitarian supplies under special allocation aimed at addressing the needs of especially vulnerable groups.  Funding difficulties continued to persist with 777 humanitarian supply purchase contracts worth $1.7 billion, which have been approved, for which, however, no funds were available.

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Produced for media and public information – not an official United Nations Document
For further information please contact Hasmik Egian, OIP - NY, 1.212.963.4341