Secondly, the article you post talks about revenue estimates that extend out 18 months. The $25 billion that is supposedly going to be needed in the first year (probably priced at contract rated in downtown NY...lol) would be used in part to INCREASE oil output and production efficiency to a competitive level.
...even in the best-case scenario - a relatively short, bloodless war that leaves Iraq's 1,500 oil wells intact and replaces Saddam with a friendlier leader - Iraq's oil industry would be fraught with economic and political uncertainties that could even discourage investment, analysts say.
Foremost is the hurdle of rebuilding the country, estimated to cost from $200 billion to $400 billion, and the risk of doing so amid potential civil wars among ethnic groups. Rehabilitating Iraq's oil operations to bring production up to its projected potential of 6 million barrels a day - more than triple what it exported last year under a U.N.-sponsored ``oil-for-food'' program - would take about a decade and cost an additional $40 billion to $50 billion, analysts say.
In the short term, Iraq's wells are capable of pumping about 3 million barrels a day, which would generate from $12 billion to $15 billion in annual revenues, assuming oil prices remain strong. That is far short of the revenue needed to rebuild the country.
``You get the sense some people in Washington, particularly hawkish members of the administration, have spent Iraqi oil revenue 10 times over before they've even gotten in there,'' said Raad Alkadiri, an analyst at PFC Energy, an oil and gas consulting firm in Washington.
``There isn't that much Iraqi revenue to spend. To say you can rehabilitate the country, pay for an occupation and revive the economy all at the same time is ludicrous.''
Any $$ coming out of oil will be sucked right out of the country. |
