After weeks of controversy, the UN Security Council authorised $300 million in equipment to upgrade Iraq's deteriorating oil industry but the supplies are not expected to reach Baghdad for months.In a unanimous vote, the Council on Friday adopted a resolution that also sought to extend the UN oil-for-food programme for as long as economic sanctions are in effect rather than renegotiate its terms every six months.
Under that programme, Iraq is allowed to sell $5.25 billion in oil over six months in order to buy food, medicine and other humanitarian supplies to ease the impact of the sanctions imposed in 1990 after Iraqi troops invaded Kuwait.
But without spare parts for its oil industry, Iraq cannot meet its targets. Even with new equipment, Baghdad says it cannot pump enough oil to sell more than $4 billion to $4.5 billion this year.
However, UN oil experts have said the new equipment would allow Iraq to pump more than $3 billion worth of oil over the next six months at current prices of $10.50 abarrel.
Benon Sevan, the UN executive director of the oil-for-food programme, left for Baghdad on Friday to study the state of Iraq's oil industry. Denis Haliday, the resident coordinator of the programme, said on Thursday that the delay in approving the equipment might have a serious impact on Iraq's ability to raise oil revenues.
The list of equipment must still be approved by the Security Council's sanctions committee and France told members it feared further delays.
The main point of contention in Friday's resolution was a provision saying that Iraq's distribution plan for food, medicine and other necessities would "remain in effect" until sanctions were lifted. At the same time the resolution said Iraq could amend or submit a new plan, providing that Secretary-General Kofi Annan approved it.
Iraq in the past had suspended oil sales, sometimes for as long as two months in an effort to maintain control over the programme, which it says has malfunctioned from the start.
The final wording of theresolution, however, allowed France's ambassador Alain Dejammet to say that Baghdad could file a new distribution plan at any time.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.