Meters Cost Iraq Billions In Stolen Oil

KTVT Investigation: Lack Of Metering At Terminals Funnels Billions Into Hands Of Corrupt Officials And Insurgents

(CBS) 
In an interview with KTVT, Samir Sumaidaie, Iraq's ambassador to the United States, conceded that there has been a massive theft of oil. "I heard about this metering problem and I think it's scandalous that we have not been able to do that,” he said. When asked where the half-million barrels of oil estimated to be stolen daily is going, Sumaidaie confirmed it was reaching insurgents and corrupt government officials. "We are facing a coalition, if you like, of extremists, terrorists, organized crime, and corruption. We are aware that there is corruption going on. And we are committed to fight that. But we also are not naive enough to believe that overnight that we can simply eliminate it. It will take time."

The ABOT is under the control of Iraq's state-owned South Oil Company, which is now dominated by Shiites in southern Iraq, and the sales are managed by the State Oil Marketing Organization (SOMO). Morris says SOMO has refused to divulge its export contracts, records of sales — or even the names of buyers — in order for him to estimate how much oil is being stolen. "There's a certain secrecy behind that, so that if you don't know what's being moved in country, then you don't know what's being lost, and you don't know what's being sold," he says. "Also, you don't know what political motivations are behind what political party wants to control the oil sales. So they can take their share of the crude sales for their own political contributions or aspirations. So there's always that push to control SOMO and keep the oil sales secret."

Parsons Iraq Joint Venture, a U.S. contractor based in Houston, is scheduled to complete installation of new meters on the ABOT by May. The Special Inspector General for Iraq Reconstruction (SIGIR) reported to Congress in its Jan. 30 report that work at the ABOT, "has suffered chronic schedule slippages." Morris says powerful people inside Iraq's Oil Ministry repeatedly blocked installation of meters and fought against other measures that would help stop pervasive corruption. "There were those people inside the ministry that didn't want the sales to be known. They were the ones who probably had the most authority, (the) most power inside the ministry."

Morris says the honest Iraqi professionals in the Oil Ministry who pushed for metering and transparency put their lives at risk. "Anytime you gave the impression that you were working with the U.S. and trying to clean up the corruption problems and the word got out, there were going to be people there to make sure you didn't. One of your family members was going to disappear, or you would disappear."

Morris also became a target. He says Oil Ministry insiders tipped off insurgents about his visits to oil facilities as well as to the ministry's headquarters in Baghdad. In 2005, his Army convoys suffered deadly attacks by a suicide bomber and another by a roadside bomb. "You feel betrayed because someone inside the ministry has already helped get you attacked and tried to kill you. Our young soldiers there would ask me at the end of the mission, 'What did you get done today? Were the meetings good? Are you getting something accomplished?' I feel bad about the deaths we had from the U.S. Army soldiers that died protecting us. It still hurts me."

Iraq holds the world's second-largest proven oil reserves — approximately 100 billion barrels, with the potential of as high as 200 billion barrels. Control of that wealth is now up for grabs and is the major driving force behind the violence in Iraq, according to Amy Myers Jaffe, an energy adviser to the Iraq Study Group, which was co-chaired by former Secretary of State James Baker and former Congressman Lee Hamilton. "You really have to think about the oil as just being dollars buried under the ground or buried in a pipeline or coming out of a refinery," she says. "It's like printed money. Imagine if in the middle of the night that you could just grab some metal tool and poke it into a pipeline where there is no security, drain out oil, put it into a truck, drive it somewhere, and become a millionaire in one day. So the incentive to steal or smuggle this oil and have it be a regular business is huge in a society where there are not good controls or security."

Jaffe, who is now the Director of Energy Studies for the Baker Institute at Rice University in Houston, says political and sectarian leaders now run Iraq's oil industry without oversight because the hurriedly passed constitution did not clearly define how to fairly divide up the country's mineral resources.

As a result, corruption has become embedded in Iraq's political system to a worse extent than during Saddam Hussein's regime, according to Jaffe. "Without oil meters and control systems, there is built up a whole black market. There are different groups that can control that flow," she says. "They can pay off politicians. They can pay off government officials and government inspectors. There are people inside the system now who are making personal, individual money, or their insurgency group or their political party is making money from corruption, from smuggling, from black market activities. So they are against instituting the kinds of procedures it would take to close all this down."

[clemenhagen1]

So billions of dollars goes missing from the untended meters in Iraq and we should automatically assume the evil powers that be in Iraq funnel the proceeds to shadowy insurgent and terrorist networks. How much money in cash disappeared under Viceroy Bremer's tenure? Nice title by the way - Viceroy possesses some thoughtful historical connotations don't you think. Got that number of missing cash yet? Oh that's right: eight billion dollars plus. Didn't that cash come from liquidated Iraqi assets. We convert Iraqi assets to cash and it mysteriously / magically disappears into the ether? But this missing oil couldn't possibly be a result of the same scenario, right? Right.

[firststate]

Does anyone really believe that quick draq and baba looey in the white house and their oil patch pals haven't known the possibilities opened up by a lack of metering? The skimming hasn't been a problem for almost 4 years until it started attracting attention. Nobody at Halliburton missed the fact that there were no meters and you can take that to the bank, but not their banks. Those are full, hence the meters being installed in May.

[radiob-2009]

The easy solution here is install new working meters.Let the Iraqis pay for them with the lost oil that they will be able to account for with the new meters.

[godmonkey-2009]

Well, Lars, you're probably right. We'll also probably destroy the environment and all die from thirst and exposure hahahaha. Of course, by then, life in America will be so miserable, an oligarchy so rife with corruption, that it'll come as a relief hahahaha.

How do you recommend we pay for this endless war? Is yore pa gonna sell his tractor and send the money to Washington? hil-hil-hil-hil

[bluestardad]

Hey Congress, We know you cannot protect innocent high school pages in the Halls of Congress nor put Pedophiles in Jail like Mark Foley, how about thieves of billions of dollars, and Liars that cause the deaths and Maiming of Thousands of American Soldiers and sends our country to a war on a lie? The Middle East is not in American Interest, we have invested 50 years of blood, and money is enough is enough! Did the Neocons slip you some money how about thirty pieces of silver for your vote or compliancy in this war?
firststatehttp://www.senate.gov/general/contact_information/senators_cfm.cfm

[gunnerv1]

Actually, Mark Foley didn't break any laws, other than being a "sick puppy". Don't worry, I'm not sticking up for him, just stating a fact.

[legendary240]

Why are 21st century Americans at the behest of 19th century ragheads?

[bluestardad]

This and the Slant drilling is why this war was started at the bidding of the Neocon chicken hawks from Saudi and Israel.

[bluestardad]

clestes ; thank you I wrote all of them except Levin of Michigan he had no contact page.

[lars008-2009]

doesn't matter.......... hahahahahaha

usa will have bases and troops in the middle east for a long long time...... get used to it.....

[bluestardad]

Great I wish more people would contact their senators!

[lars008-2009]

islam is a violation of international law

islam practices slavery on non muslims
islam practices aparthied on non muslims
islam practices rape on non muslims
islam practices genocide on non muslims

all are violations of international law and are crimes against humanity

[clestes-2009]

bluestardad, I already have.

[lars008-2009]

relax you stupid silly fascist nazi islamic muslims.......
the usa will have bases and troops in the middle east for a long long time...... get used to it.....

[bluestardad]

Hey Congress, We know you cannot protect innocent high school pages in the Halls of Congress nor put Pedophiles in Jail like Mark Foley, how about thieves of billions of dollars, and Liars that cause the deaths and Maiming of Thousands of American Soldiers and sends our country to a war on a lie? The Middle East is not in American Interest, we have invested 50 years of blood, and money is enough is enough! Did the Neocons slip you some money how about thirty pieces of silver for your vote or compliancy in this war?
firststatehttp://www.senate.gov/general/contact_information/senators_cfm.cfm

[arthurcl1]

Sure, what funds the insurgents? How do they buy weapons to shoot down our helicopters? Oil Money from their own pumps! Emperor Dyanastic Bush is responsible for this Vietnam War! He is Bankrupting this country!

[edjohn66]

I sure am glad that securing Iraq right after major hostilites ended was the #1 U.S. priority.

Wait! No it wasn't! Chaos reigned supreme for weeks because we had no post-war occupation plan!

We did, however, secure the oil fields and refineries. I sure am glad that securing the oil fields and refineries was accomplished.

Wait! You mean that wasn't done either?????

Would someone please tell me what Bush, Cheney, and Rummy did RIGHT during this whole operation? And now we are supposed to trust Bush and Cheney with an escalation of the war????????

Impeachment now! Its the only option that makes sense.

[bluestardad]

Contact your senator; The middle East is not in American Interest, we have invested 50 years of blood, money enough is enough! Saudia Arabia, Israel the lot of them, their neocons got us in this mess!
firststatehttp://www.senate.gov/general/contact_information/senators_cfm.cfm

Founded in 1953 by Isaiah L. "Si" Kenen, AIPAC's original name was the American Zionist Committee for Public Affairs. According to UCLA political science professor and author, Steven Spiegel, "the tension between the Eisenhower administration and Israeli supporters was so acute that there were rumors (unfounded as it turned out) that the administration would investigate the American Zionist Council. Therefore, an independent lobbying committee was formed, which years later was renamed [AIPAC]." [SPIEGEL, p. 52].[citation needed] Today, AIPAC has over 100,000 members.[1]
AIPAC's stated purpose is to lobby the Congress of the United States on issues and legislation "to ensure that the U.S.-Israel relationship is strong so that both countries can work together" to meet the challenges of "stopping Iran from acquiring nuclear weapons, fighting terrorism and achieving peace".[2] It regularly meets with members of Congress and holds events where it can share its views, and provide analysis of voting records of U.S. federal representatives and senators with regard to support of Israel. The New York Times described AIPAC on July 6, 1987 as "a major force in shaping United States policy in the Middle East."

[stevex47]

Anyone going to win in this debacle? Freedom for Iraqi's? Snuffing out world terrorists? Secure energy for the west?
I'm guessing none of the above. How the heck did we let this happen? Oh boy we're gonna pay for this for a LONG time. Nic job reich wing.

[bluestardad]

clestes; well spoken but who is listening? Here is how to contact your senator.

Make it count!

firststatehttp://www.senate.gov/general/contact_information/senators_cfm.cfm