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[casi] IRAQ; extra $800 to aid oil sector

AFX-Focus) 2003-07-11 00:17 GMT: US administration in Iraq seeks extra 800
mln usd to aid oil sector - official

BAGHDAD (AFX-ASIA) - The US civil administration in Iraq is requesting an
additional 800 mln usd from Congress to aid the recovery of the nation's oil
industry, taking the total cost to 1.2 bln, a senior coalition official

The official said the administration is requesting the money to repair the
country's oil fields, considered the cornerstone for its revival.

Congress had already earmarked 400 mln usd to repair the fields, but faced
blown up pipelines, looting, and refineries and equipment in worse shape
previously thought, the US civilian administrator for Iraq Paul Bremer is
an additional 800 mln, the official said on condition of anonymity.

The official added that the coalition aimed to pump out 1.2 mln barrels per
(bpd) by the end of the year and to more than double the figure to 3.0 mln
by next spring or early summer.

Oil is crucial to the coalition's plans for the country as Bremer is banking
Iraqi petroleum sales to generate 3.4 bln usd in the state coffers this
which would pay for half of Iraq's 6 bln usd 2003 budget.

The official said plans are underway to collaborate on the 2004 budget with
Iraqi governing council, to be unveiled later this month, as the US-led
occupation tries to make Iraq into democracy after years of Saddam's
authoritarian rule.

Meanwhile, the coalition's military commanders are mulling the creation of
indigenous paramilitary force in Iraq to help shoulder the growing security

Lieutenant General Ricardo Sanchez said he is considering using tribal
forces to
help protect infrastructure which is under relentless threat of sabotage
Saddam loyalists.

"The key here is to close the gap between the police and the army, and we
believe that we can in fact stand up very rapidly some force that is in
those two ends of the spectrum that will allow us to get Iraqis beginning to
assume some of the responsibility for bringing security and stability."

Sanchez gave no timeframe for the creation of such a militia or indication
how large it would be.

Iraqi citizens, particularly in the capital Baghdad, have expressed outrage
the coalition's failure to provide a sense of security in the country in the
three months since Saddam's regime tumbled.

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