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Iraq oil prospects mixed

BAGHDAD, Nov. 13 (UPI) -- Iraq's Oil Ministry is confident it can increase oil exports from the south, but the violence that has stopped oil flow from the north may trickle downward.

Assem Jihand, information officer for the ministry, said that by 2007 an additional 200,000 barrels per day will be sent out of Iraq. Iraq exports about 1.7 million bpd.

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The global energy information provider Platts estimates Iraq oil production in October averaged 2.02 million barrels a day, down from 2.14 million in September and well below the 2.6 million pre-war levels.

The vast majority of Iraq's oil is in the north and south regions, and production has been concentrated in the south because of violence within the north's infrastructure.

And on top of the pipeline and refinery attacks, the electricity shortage facing the country also keeps the oil apparatus offline.

Despite the ministry's optimism, violence in Iraq is increasing, not waning, keeping the north in a stranglehold and threatening the limited southern output.

Azzaman.com reports violence is keeping up to 400,000 bpd in exports off the market and factions fighting for control in the south have succeeded in infiltrating key refineries and companies.

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The Kurdistan Regional Government in the semi-autonomous north is the only government entity, including the central government, which has made progress in oil asset governance. Those proposed laws, however, have been dismissed by the oil minister for infringing on its authority.

And oil-rich Kirkuk, a historically Kurdish city but officially outside the KRG, is now being fought over -- both politically and by militias.

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