Commerce returns to Iran-Iraq border river

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 harbors 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 kilometers (50 miles), and that ships will pay customs fees in Umm Qasr to the south before heading to the new harbor.

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 harbor 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 harbor in the future will also be carrying goods."

Myklestad said the first ship arrived at the harbor 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 kilometer (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.

Source: Energy-Daily.
Link: http://www.energy-daily.com/reports/Commerce_returns_to_Iran-Iraq_border_river_999.html.