February 21, 2004
The Honorable C.W. Bill Young
Chairman, Committee on Appropriations
United States House of Representatives
Room H-218, The Capitol
Washington, D.C. 20515
Re: Dec. 2003 Oil Report
Dear Mr. Chairman:
In accordance with Section 2215 of the Fiscal Year 2004 Emergency Supplemental
Appropriations Act (Public Law 108-106), I submit the following report regarding
Iraqi crude oil production, oil revenues, and the use of those revenues for the
month of December 2003.
Iraqi crude oil production for December was 66.4 million barrels. Of this 18.5
million barrels went to domestic production and 47.8 million barrels were sold
for export of an aggregate revenue totaling $1.3 billion. Average price per
barrel was between $26 and $27. The average production per day was 2.14 million
barrels, which exceeded the year-end target of 2.0 million barrels per day.
Crude oil production comes from two major areas, the southern oil fields near
Basra and the northern oil fields near Kirkuk, with the majority of production
occurring in the south. Because the Iraq-Turkey Pipeline remains closed,
currently no crude oil is exported through the Turkish port of Ceyhan, and all
exports go through Al-Basra Oil Terminal (ABOT). Iraqi oil revenues are limited
by production capability and export capacity.
Export revenues for the month of December were $1.3 billion. Five percent of
Iraqi oil revenue is allocated to Kuwaiti war reparations, which totaled $65.6
million. The remaining 95 percent is deposited in the Development Fund for Iraq
(DFI), which receives deposits from multiple funding sources and is used to
support and finance the Iraqi Government’s budget. Total oil revenues deposited
into the DFI for the month of December were $1.2 billion. To date, disbursements
from the DFI have been in support of the wheat purchase program, currency
exchange program, electricity and oil infrastructure programs, Iraqi security
forces equipment, Iraqi civil service salaries, and ministry budget operations.
I trust you will find this information helpful. I have provided an identical
letter to the Chairman and Ranking Member of the House Appropriations Committee.
We will update this report each month as required by the Act. In the meantime,
please do not hesitate to contact me if I can be of further assistance to you on
CC: The Honorable David R. Obey