May 18, 2003	Sunday	Rabi-ul-Awwal 15, 1424

WASHINGTON, May 17: The US adviser to Iraq’s Ministry of Oil said it may be in that country’s best interest to disregard quotas set by Opec and export as much oil as it can, The Washington Post reported in its Saturday edition.

Phillip Carroll, former head of Royal Dutch Shell’s US operations, also told the Post in an interview that oil drilling and production contracts signed by the ousted Iraqi government with companies in Russia, China and France were potentially void or subject to renegotiation.

With world energy markets anxious for any indication of the level of future Iraqi production, Carroll noted the country had historically been an “irregular” Opec participant.

They have from time to time, because of compelling national interest, elected to opt out of the quota system and pursue their own path. ... They may elect to do the same thing. To me, it’s a very important national question, Carroll was quoted as saying.

The Post also said Iraqi Oil Ministry officials were actively considering pulling the country out of the Organization of Petroleum Exporting Countries in order to export as much crude as possible once oil fields had returned to full capacity.

Most analysts believe it could take more than a year for the country to reach the level of production needed to meet current Opec export quotas, the paper reported.

The Post said the government of Iraqi President Saddam Hussein, toppled by US-led forces, had an official policy of steering contracts for drilling services, joint production and machinery to companies in France, Russia and China, whose governments tended to be supportive of Iraq in the UN Security Council.

Carroll did not identify any specific contracts that could be in peril, but asserted the old system of preferential treatment expired with the government, the Post said.

There will have to be an evaluation by the ministry of those contracts and a determination of whether they were made in the best interests of the Iraqi people, Carroll said.

Certainly, where contracts are, shall we say, excessively beneficial to one party, and that party is not the Iraqi people, and there is a legal basis for not going forward, then I would expect that the ministry would want to have another look, he said.

Carroll stressed his first priority was the resumption of enough oil, gasoline and cooking fuel production to relieve painful domestic shortages.

He rejected suggestions the United States was using its influence in Iraq to try to break Opec.

In the final analysis, Iraq’s role in Opec or in any international organization is something that has to be left to an Iraqi government, Carroll said.

But he said Iraqis were right to consider whether they wanted to remain in the oil cartel.—Reuters