Reliance on deteriorating equipment is threatening the long-term viability of Iraq's oil industry, U.N. officials say  ALSO: Iraq moves more missiles into southern no-fly zone

August 3, 1999
Web posted at: 7:43 p.m. EDT (2343 GMT)

In this story: Spare parts urgently needed, U.N. says RELATED STORIES, SITES

BAGHDAD, Iraq (CNN) -- Nine years after the United Nations slapped severe economic sanctions on Iraq following its August 1990 invasion of Kuwait, Iraq's oil industry struggles to increase output with old, outdated equipment.

Under a U.N.-approved oil-for-food program, Iraq is permitted to sell $5.2 billion in oil every six months to pay for food and medicine. But U.N. officials said Iraq could be permanently damaging its oil industry by pumping and refining with deteriorating facilities.

Iraqi oil officials insist they are being careful.

"We are taking risks, but calculated risks. There is a lot of ingenuity going on about how to manage these reservoirs, and what we are doing now is within the sphere of accepted standards," said Faleh Al Khayat of the Iraqi Oil Ministry.

Iraqi officials say concerns about meeting 'humanitarian needs' have top priority

Spare parts urgently needed, U.N. says

A U.N. report on the state of Iraq's oil industry says the country is in urgent need of spare parts. A plan to allow Iraq to buy new equipment and parts has been held up at the U.N. sanctions committee, which must approve any such purchase.

The director of the U.N.'s Iraq Program, Benon Sevan, has warned against further delay of the spare parts.

"Additional oil being exported today should not make anyone complacent to say that they are increasing oil, why on earth bother about improving the spare parts?" Sevan said. "We should not be complacent because irrespective of the increase, the danger is there that any time that increase can drop."

Iraq, however, said it has no choice but to continue pumping.

"Of course, we are concerned," Khayat said. "But the people are also in desperate need of cash money, to support their humanitarian needs."

Reporter James Martone contributed to this report.

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