Iraq Oilfield Output Suspended After IS Fighting

Source: Reuters 2/2/2015, Location: Middle East

Production at an oilfield near the northern Iraq city of Kirkuk remained suspended on Monday after incurring severe damage during a weekend attack by Islamic State insurgents, Iraq's oil minister said.

Kurdish forces recaptured a small crude oil station at the Khabbaz oilfield 20 km (12 miles) southwest of Kirkuk on Saturday, a day after IS fighters had seized it.

"What happened on Friday was a real threat to the oil installations, but the situation now is stable and under control," Adel Abdel Mehdi told reporters during a visit to the oilfield.

"There is severe damage to the field which has halted production and damage also to the installations," he said. Black columns of smoke from pipeline networks around two oil wells were visible during the visit.

Abdel Mehdi declined to speculate when operations would resume, saying fires needed to be extinguished before assessing the damage.

IS militants seized at least four small oilfields last summer when they overran large areas of northern Iraq, and began selling crude oil and gasoline to finance operations. The attack on Khabbaz was the most serious assault on Kirkuk since then.

Hit by oil prices that have more than halved since June, Iraq is working to boost its shipments to make up for lost revenues dependent mainly on oil exports.

Khabbaz is a small oilfield with a maximum production capacity of 15,000 barrels per day; it was producing around 10,000 bpd before the attack.

Around 20 employees at Khabbaz were found and freed on Sunday after going missing during the IS attack.

One worker said the insurgents had broken into the station carrying weapons, including rocket-propelled grenades and snipers, and threatened to kill him and his colleagues.

Hikmat Ibrahim said the workers had been locked inside a bunker under the station without any water, food or power.

"It was completely dark with only the sound of bombings and clashes outside. We felt we would face death every moment we spent inside," he told Reuters.


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