Download the document

• Logistics Co-ordination Forum: Amman
• Transport Corridors
• Volumes Estimate
• Southern Corridor: General Description
• Southern Corridor: An Overview
• Volumes
• Rail Connections
• Transport Rates
• Security
• Ferry Service: UAE to Umm Qasr
• The Reconstruction Levy: Improvements
• Tugboats and Pilots
• Future Operation and Management of Ports
• Dredging and Wreck Removal
• Aviation
• Overview
• Cargo Services: DHL
• Civilian C-130 Services: Heston/SAFAIR
• Immigration: Iraqi Visas Needed
• Fuels
• Fuel Products Distribution
• Oil exports and terminals
• Sabotage
• Electrical Power
• Generating Capacity: An Improving Situation
• Major Long-Term Constraints: Time-to-Build
• Medium-Term Solutions: Combustion Turbines
• Short-Term Constraints: Fuel Needs
• Future Direction and Challenges

Logistics Co-ordination Forum: Amman

UNJLC convened on August 25th, 2004 a Logistics Co-ordination Forum in Amman, grouping those responsible for logistics matters in the respective UN agencies and international organisations.

The primary purpose of the forum is to provide an informal setting for participants to share information and perspectives on the challenges they face moving humanitarian aid and other goods into Iraq so that common approaches and solutions may be explored, if appropriate.

It is clear that most agencies and international organisations have well-established logistical arrangements in place, generally using professional transporters or forwarders. A number of these parties are still moving significant humanitarian cargoes into the country; others have minimal traffic but may increase volumes once the security environment becomes more permissive and their programmes may be more fully reinstated; some have very specialised shipments; others are interested in the overall logistical picture to assist in their contingency planning.

The forum proved particularly useful in apprising participants of the relative merits of the respective corridors into Iraq and making them aware of transport options that they may have been unaware of in what is a steadily evolving logistical environment. In particular, there seems to be less awareness of the options available for getting goods in by air, with a trade-off between security costs for ground transports and the more expensive air freight rates.

The consensus of participants at the inaugural sessions was that the forum reconvene no more frequently than fortnightly, but more frequently than monthly. The next session of the forum is therefore tentatively scheduled for mid-September. Logistics personnel from all UN agencies, international organisations and NGO's operating out of Amman for Iraq are welcome to participate.

Should demand warrant, a similar forum may be convened for logistics officers and other interested parties operating out of Kuwait.

Transport Corridors

In this bulletin, UNJLC will focus on the Southern corridor, part of which provides Iraq's only direct access from the sea, following a mission by UNJLC to the Iraq-Kuwait border at Umm Qasr.

The Turkish corridor was covered in UNJLC Bulletin 5 (August 13th, 2004), the Syrian corridor was addressed more fully in UNJLC Bulletin 3 of 2004 (July 16th, 2004); Jordan in Bulletin 2 (July 2nd); and Umm Qasr in Bulletin 1 (June 18th).

Volumes Estimate

Overall volumes of cargo into Iraq through all means - by land, sea and air - seem to be generally steady. Capacity is adjusting to the evolving situation and commercial operators in Iraq and regionally become more active. Excluding military-related and fuel cargos, it is now estimated, based on discussions with transporters and forwarders and observations at borders and ports, that approximately 60,000 tonnes per day enters the country, broadly as follows:

In addition to this, it is estimated that an average of at least 150 tonnes of air cargo enters Iraq daily.

Southern Corridor: General Description

Iraq's main port of Umm Qasr is now managed by the Iraq Ports Authority. Owing to security constraints, the main stevedoring activities are now concentrated in the New Port, located in the northern part of the port complex, where management has improved security to an acceptable level. Part of the security improvement strategy involved discouraging dhows calling at Umm Qasr. These smaller vessels now frequent the nearby smaller ports of Khor Al-Zubayr, north of Umm Qasr, and Abu Floos, on the Shatt Al-Arab Waterway. 

Southern Corridor: An Overview

Khor Al-Zubayr continues to be run by Maersk (AP Moeller) and has experienced few, if any security problems. This is in part due to its more isolated location, away from villages and other facilities. During July, it saw increased traffic of inbound food and some exports of dates and lentils.

The authorities have closed most of the smaller jetties on the Shatt Al-Arab, causing the Abu Floos facility to receive an increased number of calls. The Shatt Al-Arab ports and jetties can only accommodate small vessels whereas all larger vessels must call at Umm Qasr or Khor Al-Zubayr.

Volumes

The most prominent commodity imported through Iraq's ports continues to be food. Umm Qasr handles about 10,000 tonnes per day of food with bulk grain through its silo facility, from break-bulk vessels and containers. Khor Al-Zubayr handles around 500 tons of food per day. Food volumes through Abu Floos are of a much smaller order.

All three ports handle containers in addition to food cargos, with the vast majority going through Umm Qasr.

Owing to the implementation of regulations on maximum age of imported used vehicles and saturation in the market, significantly fewer cars were imported through the ports in July than earlier in year. The trade is certainly continuing and is expected to do so, but at a reduced level.

No military cargos seem to pass through Umm Qasr.

Rail Connections

Efforts are under way to re-establish the rail link from Umm Qasr through to Baghdad. Sabotage and a lack of rolling stock have prevented resumption of a full service. Repair work was near completion when sabotage on some sections of track delayed re-opening of the connection.
In any event, given the efficiency of the Iraq railways, the rail link may add only marginally to internal transport capacity. Trucks will continue to be the main mode of cargo transport within the country.

Transport Rates

Transport rates out of Umm Qasr have increased by 40% to 50% since the beginning of the year. This is a reflection of the general trend within Iraq where transport rates have increased significantly once Jordanian and other non-Iraqi drivers were largely forced out of the market.

Within Iraq, the maximum tolerated payload per truck and trailer/semi-trailer is 44 tons, equivalent to that allowed in Syria. However, there seems to be little enforcement of load limits. Axle load limits are unclear but a maximum truck limit seems to prevail. This provides transporters with potential for a relatively high return per tonne-kilometre.

Security

Besides the highly publicised attacks on and kidnapping of foreign drivers (mainly from Africa, the Indian sub-continent, Jordan and Egypt working for non-Iraqi trucking firms), there are reports on attacks on Iraqi drivers around Nasiriyah. These attacks are said to be entirely criminal in nature, with the purpose of extorting transit payments from the drivers, or to rob them and loot the cargo.

This area is known for being generally lawless since the end of the 1991 Gulf War. It is adjacent to marshlands where the landscape is ideal for sheltering criminal elements, some of whom are said to be of foreign, non-Iraqi and non-Arab, origin.

As a result of this threat, most operators going from Umm Qasr to Baghdad take the eastern road through Amara and Al-Kut, despite this being in much worse condition than the modern motorway that serves most of the western route. Although not entirely secure, the eastern route seems to be much safer in this regard.

Ferry Service: UAE to Umm Qasr

The main ferry operator to Umm Qasr port, Dubai's Naif Marine Services, has 4 arrivals a week from the United Arab Emirates with passengers and cargo. They have their own terminal operation and do not need pilots. Their main interaction with the port is regarding arrivals and being obliged to pay for services they do not use. Naif may be contacted in Dubai on telephone +971 4 345-7878, fax +971 4 345-5570, www.naifmarine.com, info@nafimarine.com.

The Reconstruction Levy: Improvements

The Reconstruction Levy, imposed by CPA Order 38 as amended by CPA order 70, is levied mainly on commercial cargo going into Iraq at a rate of 5%. It will be applied at least through to the end of 2005. Food, government purchases and reconstruction materials are exempt, but collections under it provide an indication of the value of non-exempt imports into Iraq.

The Basra region, which covers the southern corridor, is responsible for seven entry points as noted in the graph below. Overall, the region has shown a steady increase in collections of the levy in recent months, with more than US$2 million collected in July, up from less than US$1.5 million in June.

There has been a significant increase in collections from Abu Floos. This reflects the closure of the Shatt Al-Arab jetties where it was more difficult to collect the levy and the concentration of trade on Abu Floos. This area had been considered less manageable than the two main ports of Umm Qasr and Khor Al-Zubayr but marked improvements seem to have taken place.

As most of the food and reconstruction material - being exempt from the levy yet nevertheless accounting for most imports - goes through Umm Qasr, the graph cannot give a correct indication of volumes in general. It is, however, clear that commercial trade into Iraq is increasing, and that the relative freedom of Abu Floos is more appreciated by traders than the two more established ports. The popularity of Abu Floos may be in part due to the onerous Inspection-at-Sea regime (see UNJLC Bulletin 2 of July 2nd, 2004) for containerized vessels calling at Umm Qasr and Khor Al-Zubayr, which makes them less cost-competitive compared to the smaller vessels calling at Abu Floos.

Tugboats and Pilots

There is general dissatisfaction among operators and agents in Umm Qasr about the availability of tugboats and pilots. Only two tugboats are shipshape and there is a constant lack of fuel to run them.

Pilots are reported to have demanded separate payment over and above the mandatory IPA pilotage fees. Delays in boarding have been reported from those vessels that declined to or delayed payment of these unsanctioned requirements.

Future Operation and Management of Ports

The Iraqi Government tender for the future management of Umm Qasr and Khor Al Zubayr has not yet been finalized. Dubai Ports International is considered to be the leading contender for Umm Qasr, and Maersk for Khor Al-Zubayr.

In Umm Qasr, Stevedoring Services of America (SSA) handed over operational management of Umm Qasr Port to the Iraq Ports Authority (IPA) in late June. SSA still provides support to IPA for accounting and management information.

There was some concern about the management of the port after SSA left, despite vocal criticism of their management and lack of investment during their tenure. The recent efforts of the IPA seem to be more appreciated by users. There is dissatisfaction, but  not in the extreme.

Two new big mobile harbour cranes will be arriving in Umm Qasr during September. This investment should improve the productivity of the port considerably and allow for quicker handling of heavier loads. A tender for the refurbishing of the two long-unused gantry cranes in the old port closed on 31st July, but the contract has not yet been awarded.

Serious consideration has been given to concentrating container activity in the South Port. This will require dilapidated sheds being torn down and the old sulphur jetty being integrated into the main quay-wall.

Dredging and Wreck Removal

The United Nations Development Programme (UNDP) has recently completed a dredging survey in preparation for continued dredging of the fairway leading to the ports of Umm Qasr and Khor Al-Zubayr. The dredging will resume shortly.

Recently Umm Qasr received the largest vessel calling at the port for at least the past 14 years with the Osge Aksoy discharging 44,500 tonnes wheat. The draft on arrival was 11.40 metres while port management is prepared for vessels with up to 11.70 metres draft.

UNDP is preparing to remove wrecks in the fairway but is awaiting funding. The wrecks are an obstacle to passage of ships and significant environmental hazard, including to vital desalination plants in neighbouring Kuwait. A meeting with potential donors will take place in Kuwait early October.

Aviation

Overview

Baghdad International Airport was closed to civilian passenger flights for several days in the third week of August, with at least one passenger aircraft stranded overnight. It is believed that there was an increased threat from anti-aircraft missile activity directed against a large passenger aircraft. The airport has now reopened. There were no civilian aircraft losses before, during or after the closure.

Aviation capacity into Iraq continues to improve for both cargo and passengers. In addition to charter flights for specific cargoes, generally available from Europe and the United Arab Emirates, the following regular services have been identified:

In addition to these services, the International Committee of the Red Cross has a small aircraft operating from Amman for its own purposes, and those of the Iraqi Red Crescent Society. Iraqi Airways conducted a test flight from Baghdad to Amman early in the last week of August with a newly-acquired Boeing 737. A regular service by Iraqi Airways is probably, but not before mid-September. UNJLC is maintaining liaison with Iraqi Airways and will advise of developments.

Jordan Aviation (www.jordanaviation.com), 962(06)464-9703 or 461-2229, will also consider requests for passenger flights to Baghdad and other destinations in Iraq, depending on security clearance and operational requirements. They operate two Airbus A310's, an Airbus A320, and two Boeing 737's. Jordan Aviation advises that they may also provide an air ambulance service.

Further details of services by Royal Jordanian, Air Serv International and SkyLink are available in UNLC Bulletin 4 of 30th July 2004 and Bulletin 5 of 13th August 2004. At present, SkyLink appears to be the only operator providing services from Kuwait into Iraq to persons other than the Coalition military, diplomatic and contractor personnel.

None of the services noted above have adequate countermeasures satisfactory to UN security authorities. UN personnel may not use these services. NGO's with differing security requirements may be able to use these services, depending on eligibility in the case of Air Serv.

UN Humanitarian Air Services (UNHAS) operations, based out of Amman, remain temporarily suspended but there is a possibility that they may resume from early November.

Cargo Services: DHL

The biggest and perhaps most important scheduled cargo operator into Iraq is DHL. Operating from its regional hub in Bahrain, it carries about 100 tonnes per day into Iraq. This service uses six aircraft rotations with combinations of Airbus A300B4-200F, Antonov 12, and Boeing 727 aircraft.

Destinations include Baghdad, Mosul, Kirkuk, Talil, Al-Asad (between Heet and Haditha, on the road from the border crossing point to Syria at Al-Qaim, and Ramadi), Al-Taqadum (west of Falluja, between Falluja and Ramadi), with road connections to Tikrit and Balad. There are direct flights from Bahrain to Baghdad, and from Bahrain to Mosul. The Antonov 12 conducts a daily "milk run" from the north to south of Iraq and back again,

Cargo weight capacities are about 45 tonnes for the Airbus A300, 12 to 16 tonnes for the Antonov 12, and 18 tonnes for the Boeing 727. It is understood that refrigerated cargo may be carried.

Further details are on the respective aircraft type are available on:

Contacts for Iraq, based in Kuwait, are Mr. Michael Nistor, michael.nistor@dhl.com, phone (965) 901-2599 and Mr. Steve Garside, steve.garside@dhl.com, phone (965) 678-9104. The DHL office in Kuwait is (965) 244-2375 or 431-8300. Other DHL offices may be directly contacted for further information. The Company has offices and staff in Iraq, including in central Baghdad and at Baghdad International Airport.

Southern Iraq is served by DHL by road from Kuwait. A road service from Jordan is being considered dependent on security improvements, together with air links.

There is no indication at present that DHL can carry passengers into Iraq.

Civilian C-130 Services: Heston/SAFAIR

Heston Middle East - Jordan has recently commenced a passenger and cargo air service into Iraq, using an L-100-30 Hercules, the civilian version of the C-130 Hercules, operated by SAFAIR of South Africa.

The aircraft is certified for 90 passengers or between 20 and 22 tonnes of freight, or a combination of both. It can transport rolling vehicles of various sizes. The service can also execute cargo airdrops, including specialised food airdrops, when landing facilities are not available.

Destinations presently served include Baghdad, Basra, Mosul, Erbil, Tikrit, Kirkuk, Balad and Taji.

The primary contact for this service, based in Amman, is Mr. Neal Kawar, nealkawar@heston.net, phone 962(06) 553-1489 or 553-9657.

Immigration: Iraqi Visas Needed

Immigration has emerged as an issue of concern for humanitarian staff trying to enter Iraq. There is inconsistent application of new visa rules at various entry points, and little clear or definitive guidance.

Since the cessation of hostilities in April 2003, there has been little problem in entering Iraq. Visas were not needed. However, in mid-August, civilian arrivals at Baghdad International Airport from Jordan were turned back because they did not have Iraqi visas. Other people seem to be able to enter Iraq by land from Jordan, Kuwait and Turkey without visas. It is unclear whether ferry passengers landing at Umm Qasr require visas.

Discussions with Iraqi consular officials in Amman indicate that Iraqi visas are available from the respective Iraqi Embassies only in Amman, Ankara, Beirut, Cairo and Damascus. An Iraqi Embassy is operating in Abu Dhabi but no Iraqi embassies in the Gulf Co-operation Council States are yet authorised to issue visas. Iraqi Embassies are not yet operating in Kuwait or Saudi Arabia.

UNJLC has obtained verbal assurances from an Iraqi consular official in Amman that Kuwait-based humanitarian workers may submit their passports to the Amman embassy for the visa application, without having to attend the embassy in person, provided that a responsible authorised individual follows the application in Amman.

To obtain a visa, UNJLC was advised that an applicant is required to have their office or counterparty in Baghdad approach the Ministry of Foreign Affairs (MFA) in Baghdad, either directly or through the line Ministry their organisation may be working with. The MFA will then endorse the application and issue a reference number which is then transmitted by the MFA to the respective embassy where the application is to be lodged and to the proposed entry point. The applicant's office or counterparty in Baghdad should also be made aware of the number and the applicant should quote this in their visa application. Once the number has been transmitted to the responsible embassy, processing should take at least three days, but may take up to a week. A fee of US$40 applies. The application form is available from the Iraqi Embassy or at www.unjlc.org/content/index.phtml/itemId/21894.

The visa is valid for one month but may be extended in Iraq for, it is understood, up to three months. The visa must be used within one month of issue and a separate visa is required for each visit. Multiple entry visas do not yet seem to be possible. People seem to have no problems in Iraq if they are seen to not have a visa, and appear to be allowed to leave with few problems.

A curious situation has arisen in the south where humanitarian staff have been prevented by the Kuwaiti authorities at Abdaly from entering Iraq unless they have an Iraqi visa in their passports, whilst it is impossible to obtain an Iraqi visa in Kuwait. The Iraqi officials on the Iraqi side of the border at Safwan seem to be allowing humanitarian workers in without problems. In several cases, communication between the Iraq and Kuwaiti officers has been required for the Iraqis to assure the Kuwaitis that the individuals may cross from Kuwait into Iraq without a visa. UNJLC, in conjunction with UNAMI and other interested parties, will endeavour to clarify this situation with the Kuwaiti authorities.

Fuels

Fuel Products Distribution

The most apparent fuels shortage in recent weeks has been in the conflict city of Najaf where little or no fuel supplies of any kind have reached the city. Fuel products availability in Anbar Governorate is also insufficient, with not more than 60% of the required quantities available.

However, from a logistics perspective, particularly for humanitarian cargos from Jordan, the situation is generally good. Fuel stations on Highway 10 from Jordan have enough supplies, albeit at high prices. Truckers on this route can afford the fuel; ordinary people cannot.

The situation in the northern governorates is still good for all fuel products. Imports from Turkey are continuing with estimated quantities of 130,000 tonnes per day of refined products crossing the border and appreciable quantities delivered  to the main depot in Mosul. Fuel tankers on this route have priority through the Turkey/Iraq borders.

In the south, UNJLC witnessed that fuel tankers convoys from Saudi Arabia destined for the main depots in Latifiya have stopped with the closure of the Saudi border at Ar'Ar in mid-August. This followed the withdrawal of all Saudi fuel trucks following attacks on drivers. It is expected that this will increase shortages in Baghdad and in the south-central governorates that are already poorly supplied.

Oil exports and terminals

It is believed that crude oil exports were cut to between a third and a half of the normal level during recent weeks with estimates of no more than 1.4 million barrels per day exported, compared to 2 million bpd in the first half of the month. It seems that the Ministry of Oil decided to close one of the pipelines to the export terminal because of heightened risk of sabotage to the line and the effect of actual sabotage. It is understood that this was in part related to the Najaf situation. An attack on the premises of the South Oil Company, during which the headquarters building was burned, has also disrupted oil production and transportation in the south.

Mina Al-Basra and Khor Al-Umaya offshore oil terminals continue to work but with reduced loading rates. The Khor Al-Zubayr oil terminal remains very busy with the traffic of vessels calling to load heavy fuel oil or discharge fuel products such as diesel, kerosene and LPG. The port is at or near capacity. Any technical problem might lead to long delays in berthing of vessels.

Sabotage

Sabotage to the main Iraqi crude and refined products pipelines is continuing, with the Iraqi-Turkish pipeline still out of operation and various lesser attacks disrupting deliveries to refineries and depots.

The insurgents seem to have a regular cycle of hitting strategic locations once repairs to previous sabotage are complete. This will be a recurring problem for the foreseeable future.

Electrical Power

Generating Capacity: An Improving Situation

Peak power generation levels are now regularly reaching 5200MW. Hourly energy levels have, for the first time, exceeded 110,000 Megawatt Hours - a better measure of performance.  As summer temperatures abate, the load is decreasing.  Most consumers should soon receive between 11 and 15 hours of electricity per day.

The initial US Army Corps of Engineers projects have mostly been completed; initial USAID projects should be completed over the coming months.  The authorities are confident that 6000MW is achievable by the end of 2004.  New projects managed by the Ministry of Electricity and the Program and Contracting Office are being commenced. The tentative but unofficial target for summer 2005 is 7500MW. This is optimistic; a level of between 6500MW and 7000MW may be more attainable. This would not meet peak demand, but the shortfall would be manageable.

Major Long-Term Constraints: Time-to-Build

Iraq's large thermal power stations, which provide the bulk of the country's generating capacity, have generally high output, greater reliability than other plant types, and lower running costs. They are thus particularly suited for 'base-load' generating capacity.  Immediately after the war, approximately 56% of national grid power was generated by these stations. They are capable of burning most fuel types but generally use crude or residual fuel oil, even if designed to run principally for natural gas.

However, in normal circumstances, construction of thermal power stations takes three to four years.  In Iraq, this has historically taken much longer. In essence, new thermal power stations are not a short-term solution to Iraq's urgent requirement for additional generating capacity.

Medium-Term Solutions: Combustion Turbines

The second major class power plant in Iraq are the Combustion Turbines (CT's), also known as gas turbines. Unlike thermal stations, these may be installed in between four months and one year, depending on size.  For this reason, short to medium term alleviation of the supply-demand gap relies on the installation of such plants. Most new generation projects started over the past year use  CT's, except for some smaller diesel-burning engines.

However, the generating capacity of CT's is typically much less than that of thermal power stations. In effect, CT's are an expensive long-term solution for a short-term problem.

Like thermal plants, combustion turbines may burn different fuel types although they are designed primarily for natural gas. Diesel and other higher-level distillates may also be used for similar performance. CT's may also burn crude and residual fuel oil, provided that it is treated first.  This process requires expensive and complex equipment with trained operators and the resultant power output is significantly lower than for natural gas.  CT's burning crude or residual fuel oil need to be completely stopped on a regular basis - often weekly - for thorough cleaning.  This reduces the overall levels of generation available nationally with several units offline concurrently for cleaning.

Short-Term Constraints: Fuel Needs

The major constraint on increasing the levels of generation in the short term is the lack of suitable fuel for power stations. This may seem perverse in a country such as Iraq with large hydrocarbon reserves. It is a question of the right types of fuel, and of getting that fuel to the power stations.

Every barrel of crude oil or residual fuel oil burnt in power stations represents lost revenue for the Iraqi treasury. Iraq undoubtedly needs more electricity; it also needs revenues to fund reconstruction. A balance therefore has to be struck between using crude to generate power and to generate money.  The Ministry of Oil and Ministry of Finance wish to maximise revenues and are resistant to burning ever larger quantities of crude oil in either thermal or combustion turbine stations.

Diesel is almost as good as natural gas as a fuel for combustion turbines and is indeed used in a number of Iraqi power plants.  However, Iraq's three ageng refineries cannot produce sufficient refined fuel products to meet domestic demand, requiring imports that are both hugely expensive and logistically difficult. For these reasons, dependence of electrical power generation on diesel should be reduced, not increased.  Diesel is not really an option.

Natural gas, on the other hand, is difficult to export and therefore does not have the same export value as crude oil.  An additional benefit of using natural gas for electrical power generation is the low emissions of pollutants.  The ideal fuel, even for thermal stations, is clearly natural gas. Iraq has huge quantities of this product. An estimated 1.2 to 1.8 billion standard cubic feet of natural gas are produced daily as a by-product of crude oil production.  However, most of this is being flared - burnt into the atmosphere in the oilfields or at refineries - without any benefit.  Only a small quantity of natural gas in the south is collected and used for power generation. There has been no investment in natural gas infrastructure for many years and such infrastructure that does exist has fallen into disrepair.

Future Direction and Challenges

Investment in the natural gas infrastructure with the intention of using the gas in power stations is obviously sensible.  However, the funding required runs into the billions and projects will take several years to implement.

The strategy of the CPA, when it controlled Iraq, was that crude oil should be exported and that the fuel of choice for electrical power generation should be natural gas.  It was decided that no new power stations requiring liquid fuels would be built with US Supplemental funds, and that such funds appropriated to the electricity sector would be used to develop the natural gas infrastructure.  The Ministry of Electricity and Interim Iraqi Government is not bound by this decision and may very well continue ordering new gen-eration capacity requiring liquid fuel. Whether the Ministry of Oil will then be able to - and indeed choose to -  provide that fuel remains to be seen.

There may well be a delay, therefore, in increasing the levels of generation even after the projects that are currently ongoing are completed, while the natural gas infrastructure is being improved.