28 February 2007

Full text of Dick Cheney's speech at the Institute of Petroleum Autumn lunch, 1999

By Dick Cheney

"By 2010 we will need on the order of an additional fifty million barrels a day. So where is the oil going to come from?... Oil is unique in that it is so strategic in nature. We are not talking about soapflakes or leisurewear here. Energy is truly fundamental to the world’s economy."

~~~~~~~~~~~

Your Excellence, Ladies and Gentlemen, pray silence for the President of the Institute of Petroleum, Mr Chris Moorhouse.

Thank you.

Its my privilege and honour to welcome all our guests to this, the second Autumn lunch arranged by the Institute of Petroleum. It’s very good to see so many friends, old and new here today. Close to three hundred I’ve been told, so welcome. Guests represent not only a broad cross-section of the UK energy industry, including the major energy companies, contractors, suppliers, consultants, but also representatives from many of the industries associated with the energy business. My own guests include a broad cross-section of the senior representatives of the Institute of Petroleum itself, welcome gentlemen, and I would make special mention of Basil Butler and Larry Farmer who helped to secure today the presence of our principal speaker. The breadth of representation around the room clearly demonstrates a wish to have this kind of opportunity to meet colleagues from the energy industry in such an informal setting, but even more demonstrates a real wish to hear the views of our eminent speaker today. So on behalf of all, I would like to say a very special welcome to Dick Cheney. Dick Cheney is a household name around the world, not only as the Chief Executive Officer of Halliburton, but also from his previous long and distinguished career in US politics. He grew up in Wyoming and was educated at the Universities of Wyoming and Wisconsin and embarked on a career in public service. After appointments to the staff of the Governor of Wisconsin and as a congressional fellow on the staff of a member of the House of Representatives, in 1969 he joined the Nixon administration. He served in a number of positions at the Cost of Living Council, the Office of Economic Opportunity and in The White House, when Gerald Ford took over the presidency in August 1974, Dick Cheney was invited to serve on the transition team and later as Deputy Assistant to the President. In November 1975 he was named Assistant to the President and White House Chief of Staff, a position he held throughout the remainder of the Ford administration. Returning to his home state of Wyoming in 1977, Dick Cheney was elected to serve as the State’s sole congressman in the US House of Representatives in 1978. He was re-elected five times. At the end of his first term his Republican colleagues elected him to serve as Chairman of the Republican policy committee. He later became Chairman of the Republican Conference and House Minority Whip. As Secretary of Defence from March 1989 to January 1993 Dick Cheney directed two of the largest military campaigns in recent history, Operation Just Cause in Panama and Operation Desert Storm in the Middle East. He was also responsible for shaping the future of the US military in an age of profound and rapid change as the Cold War ended. For his leadership in the Gulf War Dick Cheney was awarded the Presidential Medal of Freedom by President George Bush on 3rd July 1991. After leaving the Defence Department in 1993, Dick Cheney served as a Senior Fellow at the American Enterprise Institute and lectured widely around the country. He currently serves on the Board of Directors at Proctor and Gamble, Union Pacific and EDS. He is a member of the Board of Trustees of Southern Methodist University and the American Enterprise Institute. He also serves on the Board of Directors and the Public Policy Committee of the American Petroleum Institute. Not surprisingly, with such a wide ranging career in politics and now at Halliburton, Dick Cheney as a deep interest in the geo-politics of the energy industry, so we are privileged today to have his unique insight into the energy industry in the new century. Ladies and Gentlemen, I ask you to join me in welcoming Dick Cheney.

Applause.

Dick Cheney :-

Thank you very much for that welcome and that introduction. I am delighted to be back in London today and have an opportunity to spend some time with all of you. To hear that resume reciting all of my political background and experience, of course oftentimes people say that work in the oil industry is not really sort of an uppercrust kind of organisation and I say, ‘Yeah, but I used to be a Congressman and it’s clearly a step up for me to go from the political world to the world of the oil and gas industry. I’m often asked why I left politics and went to Halliburton and I explain that I reached the point where I was mean-spirited, short-tempered and intolerant of those who disagreed with me and they said ‘ Hell, you’d make a great CEO’, so I went to Texas and joined the private sector.

But I am delighted to be here and I want to try to avoid, I understand last year when Sheikh Yamani spoke that he was rather pessimistic about the outlook for oil prices and the ability of OPEC to arrive at a price level and maintain it over time and I’m not sure that it’s fair to come back a year later and second-guess and I hope a year from now people won’t do that to me in terms of the forecasts I’m going to make, but I do want to talk about the outlook, certainly from the perspective of Halliburton, how we look at what may occur here in the future and let me say at the outset that I am unreasonably optimistic about our industry.

From the standpoint of the oil industry obviously and I’ll talk a little later on about gas, but obviously for over a hundred years we as an industry have had to deal with the pesky problem that once you find oil and pump it out of the ground you’ve got to turn around and find more or go out of business. Producing oil is obviously a self-depleting activity. Every year you’ve got to find and develop reserves equal to your output just to stand still, just to stay even. This is true for companies as well in the broader economic sense as it is for the world. A new merged company like Exxon-Mobil will have to secure over a billion and a half barrels of new oil equivalent reserves every year just to replace existing production. It’s like making one hundred per cent interest discovery in another major field of some five hundred million barrels equivalent every four months or finding two Hibernias a year.

For the world as a whole, oil companies are expected to keep finding and developing enough oil to offset our seventy one million plus barrel a day of oil depletion, but also to meet new demand. By some estimates there will be an average of two per cent annual growth in global oil demand over the years ahead along with conservatively a three per cent natural decline in production from existing reserves. That means by 2010 we will need on the order of an additional fifty million barrels a day. So where is the oil going to come from?

Governments and the national oil companies are obviously controlling about ninety per cent of the assets. Oil remains fundamentally a government business. While many regions of the world offer great oil opportunities, the Middle East with two thirds of the world’s oil and the lowest cost, is still where the prize ultimately lies, even though companies are anxious for greater access there, progress continues to be slow. It is true that technology, privatisation and the opening up of a number of countries have created many new opportunities in areas around the world for various oil companies, but looking back to the early 1990’s, expectations were that significant amounts of the world’s new resources would come from such areas as the former Soviet Union and from China. Of course that didn’t turn out quite as expected. Instead it turned out to be deep water successes that yielded the bonanza of the 1990’s.

A fundamental challenge for companies is to do more than replace reserves and production. The trick obviously is also to replace earnings. For most companies the majority of their profits come from core areas, that is areas where they have significant investments, economies of scale and large license areas locked up, but many of these core areas are now mature and it can be difficult to replace the earnings from the high margin barrels there. Some of the oil being developed in new areas is obviously very high cost and low margin.

Companies that are finding it difficult to create new core areas through exploration are turning to production deals where they can develop reserves that are already known, but where the country doesn’t have the capital or the technology to exploit them. In production deals there is less exploration risk but dealing with above ground political risk and commercial and environmental risk are increasing challenges. These include civil strife, transportation routes, labour issues, fiscal terms, sometimes even US-imposed economic sanctions. Many companies are more comfortable dealing with the below ground risk like drilling and reservoir performance than they are with the above ground political risks. The other major element that it is changing is the nature of competition.

One of the biggest questions is what the competitive field will look like in the new industry after this current wave of consolidation in the oil business. Clearly the main driver behind the biggest mergers are the cost savings that are anticipated as a result of economies of scale. Concentration and critical mass are clearly keys to success. There are also cases where difficulty in sustaining and growing the companies as led management to offer the firm to a bigger player. In the world-wide competition for capital, there are imperatives for size and scale. Larger companies tend to have the highest credit ratings and therefore the lowest borrowing costs, but they also tend to have higher multiples in the stock market. The share price premium becomes a valuable currency for take-overs. They also have stronger financial staying power to undertake the larger projects and to ride out the lean periods. The result of all this consolidation is that now four out of the five largest oil and gas companies by market value are European.

For oil companies I do not believe that the bigger is better model is the only viable one. While Halliburton has certainly grown bigger through its merger with Dresser and other key acquisitions, this made sense in part because it gave our company both a broader array of services and also greater depth in products and services.

For oil companies I see four basic types of firms that I think will survive and prosper in the new environment. First, we will obviously have the super majors, but they have to be careful to avoid the dragdown of facts and the distractions of physically merging, plus the danger of becoming lumbering giants. I think there is a good chance they will avoid becoming bloated bureaucracies because they are very focused on delivering cost saving synergies for their shareholders.

The second type of survivor will be those companies that have dominance in a region or a market. These integrated companies may not be in the top five globally, but they will be number one or number two in their respective markets. This gives them the critical mass and concentration to compete and win on their turf. Repsol YPF is an example of this type of company; number one in Iberia and the southern corner of Latin America and very profitable.

A third model for competing in the new century is that of what I would call the super independents. These are firms that focus on one line of business but have sufficient scale to have several core areas of material size where they can go head to head with anyone. These combine the advantages of a super major with the agility of an independent. A common element in these three classes of firms will be critical mass and concentration.

A fourth category of survivor in the new competitive world will be what I call niche players who can prosper off the properties that the bigger firms don’t want or because of the very special circumstances they find. Those in the special players will obviously have to compete somewhat below the radar screen of the more dominant companies.

The immense portfolio restructuring that we think likes ahead in the wake of the recent large mergers should create opportunities for competitors to strengthen their positions. New aggregators are likely to emerge which, together with a lot of the brain drain from staff cuts at the majors, could well provide the bigger companies with unexpectedly strong competition in the decade ahead. In many ways the traditional role of oil companies are changing. Increasingly we are seeing international oil and gas companies concentrating on managing investment, financial, commercial and political risk or above ground risk, while service companies are managing technical, completion and operating risk. Meanwhile, national oil companies are focused on managing their country’s national interest and its resources and in the domestic markets. This is part of the new resource rationalism of the 1990’s. NOC’s may own the resources, but when it is in the national interest to bring in outsiders to help develop them, they do so. Venezuela obviously is a clear example of what I would define as the new resource nationalism. Some NOC’s are still looking outside their own borders, but I expect that in the future the emphasis may well be closer to home.

NOC’s can focus on becoming regionally dominant players, leveraging off their strong domestic base to move into neighbouring countries. This will occur where there are links and synergies with their home business, not just going global for its own sake. I think Petrobras in Brazil may be an example of this in Latin America.

People ask about the future role for OPEC. Certainly the organisation represents companies that have a vast amount of oil reserves and it has held together for over a quarter of a century already. OPEC have shown the ability for crisis management every time oil prices have dropped to single digit levels, but the group may ultimately bring about its own undoing if it shoots for too high a level for oil prices. As observers point out, in the long run, this effectively underwrites higher cost oil exploration and development around the world all at the same time, limiting demand growth below what it might otherwise be. Nonetheless, I believe most of us in the industry have welcomed the restraint in he leadership shown by OPEC in recent months and the improved outlook for the international oil markets. I know I am pleased with the leadership provided by Saudi Arabia, Mexico and Venezuela and in the long run I think the world will be best served, and the consumer best served as well as producers, by stable prices at reasonable levels.

The oil industry will become more integrated in the new century but not necessarily in the traditional sense of link ups between producers and refiners. The new integration will bring together new capabilities, skills, technology and risk management to create synergies that add value. From my perspective in the oil service industry I see an integrated role for us in helping to manage certain technical risk, leaving oil companies to retain control but focus on investment decisions, commercial and political risk and financial risk.

Oil companies probably spend the most and make the lowest returns on the actual development and operation of their assets. It is here in the middle of the opportunity chain where service companies can add the most value on the below ground aspects of the operation. Service companies can assist oil companies in making knowledge based value added decisions and implementing them quickly; through this type of integration oil companies can better leverage their skills and resources to maximise value, focusing on their core competencies. For NOC’s, working with service companies can make use of the best technical expertise available world-wide, whilst still retaining control and managing the state’s interest in its own natural resources. Service companies are becoming more integrated themselves oftentimes offering integrated solutions.

Let me say a word or two about the impact of technology in the new century. Clearly technology has revolutionised the oil business in the last decade with rapid advances in data interpretation, reservoir management, enhanced oil recovery, directional drilling and deep water operations and the pace of advancement is accelerating. The oil industry is saddled with this image problem as a polluting manufacturing industry when in reality it has become a knowledge based business. The application of technology and information processing is remarkable. Our success as a company and as an industry will depend even more heavily in the future on our ability to develop and deploy new technology.

Let me say a word, if I can, about natural gas because we think there will be tremendous growth occurring in this area in the years ahead. In terms of the North American natural gas market, we are consciously bullish over the next five years and beyond. The demand side has plenty of up side and gas is likely to grab a greater share of US energy consumption in the decade ahead. Virtually all new US power plants are likely to be gas fired and residential penetration is growing fast as well. On the supply side, onshore gas outputs should be weaker and this means that the demand gap will need to be met by perhaps double digit growth rates and Canadian imports and various significant increases in production out of the Gulf of Mexico. The industry will need to get busy bringing on new production facilities and pipelines systems to meet these needs. Deep water gas, obviously, will have a very important role to play.

There are a number of factors which we believe will drive the growing role for gas on a global basis. The environment, obviously, will be a key driver in the natural gas business in the new century as there is increasing opposition to so called ‘dirty fuels’ like coal and high sulphur fuel oil. Gas is the preferred fuel for power generation. There are continuing technological innovations in gas for power generation, combined psycho plants, greatly increased output efficiency. Gas to liquids is in the threshold of commercial success. There is growing demand in emerging markets like China, India and Brazil. For international oil and gas companies, gas is increasingly a key element of the E and P portfolios - oil becomes more difficult to replace while gas reserves and production will grow. Another reason natural gas will have a huge role in the next century is that the world’s gas resources are obviously vast.

The Middle East and Africa have over one hundred year’s supply of gas reserves at current low usage levels and the former Soviet Union and Latin America have gas reserve to production ratios which should last over seventy years. Even estimates of proved gas reserves understate the volumes involved, since there is plenty of gas still to be found and many existing discoveries have not been booked, usually due to the difficulty of getting gas to market. As companies find more gas, they need to find ways to monitise the remote fields, developing stranded gas often entails new risk involved in building a new market to use the gas. The three main options for moving this gas to market are pipelines, liquefied natural gas and now gas to liquids.

The world will get more and more connected with gas pipelines in the new century as high strength steel and automated equipment allow pipelines to become economical over long distances. In LNG new markets will fundamentally alter the nature of the business. The days of the twenty year take or pay contracts and top drawer buyer credit ratings like Tokyo Electric are over. New buyers will be local power generators in places like India and Turkey. Credit worthiness of new buyers, contracts lengths and base floor prices will be under pressure, introducing new risk. New structures will be needed to share the risk in building the new markets amongst all the participants: producers, consumers, governments and project managers. The long waiting list of green field and LNG expansion projects may signal market limitations for LNG, problems for putting together new projects are due in part to economic slow down in Asia. LNG producers are facing greater competition and lower returns and they may need to look at investing down the gas chain and re-gasification and power as well.

Long term, there are innovations on the way such as power generation synergies with re-gasification, cost reductions and smaller scale projects that could permit floating LNG terminals. An alternative to LNG as a means of monitising gas reserves is gas to liquids, or GTL which serves a completely different market. This is a well established process for turning low value gas into high value, ultra clean, refined products that are easily transportable meeting the coming demand for green fuels. With a huge world market for refined products, gas to liquids is much more flexible than pipeline or LNG projects which require rigid contracts and offtake commitments. GTL products can be exported inexpensively on product tankers and distributed through existing infrastructures. The appeal of gas to liquids is that there is no exploration risk as with oil, no market risk as there is when trying to open up new areas to gas.

The remaining hurdle has been the economics, but while the conventional wisdom is that gas to liquids viability is still a way off, there are commercial projects on the way right now that have attractive rates of return with the right tax incentives and when viewed as part of a larger strategy. For example, Chevron and Sasol’s plant, Escravos GTL plant in Nigeria is the enabler that permits things such as more gas processing with associated liquids productions, lubes and an ethylene plant. The project, together with Shell’s rebuilding of the MDS plant in Bintulu Malaysia, and projects in Cutter and elsewhere show that GTL’s time is finally arriving. The viability of gas to liquids will be further enhanced through incremental improvements and radical technology breakthroughs in areas such as process, catalyst and reactor technology leading to lower costs, increased efficiency and greater scale and this could herald a revolutionary new era for the international gas industry. Companies are looking at all the sectors : gas transmission, gas distribution, gas trading, power generation, electric utilities, even electricity trading. Some think the opportunities are in owning the infrastructure, while others see the preferred role in the merchant banking function in the energy business, especially trading and providing financial instruments. Still, others think the key is in having the customers and cross selling services. In some instances, gas and electric utilities facing the loss of monopoly positions want to diversify into higher growth, unregulated businesses like oil and gas.

For the other side, oil and gas companies may seek the earnings stability of an utility business that can broaden or integrate their business. These new businesses could cushion the earnings volatility of the petroleum side of the business, for example one of the companies whose earnings held up the best in 1998 during the oil price downturn was Repsol due to its stable income from Gas Natural. In any event, gas and power will be of growing importance in the portfolios of many energy companies with new forms of integration and this has the potential to expose companies to new and unfamiliar risk.

Firms have a lot to learn about electricity price risk and spark spreads. In addition to new risk there will be new competition. Major players may include names likes CMS, AES, Duke Energy, Reliant, Dominion Resources etc. In the minds of many, the energy business is becoming a commodity business whether it’s oil or gas or kilowatts. I think that in many ways it is also a service industry and in any event, on the product side, one has to concede that these are nonetheless unique commodities.

Oil is unique in that it is so strategic in nature. We are not talking about soapflakes or leisurewear here. Energy is truly fundamental to the world’s economy. The Gulf War was a reflection of that reality. The degree of government involvement also makes oil a unique commodity. This is true in both the overwhelming control of oil resources by national oil companies and governments as well as in the consuming nations where oil products are heavily taxed and regulated.

Essentially, the petroleum industry deals with extreme risk and with billions of dollars on the line. Oil is produced in distant lands as a result of huge risk and enormous capital outlays, it is transported over vast distances, refined in expensive refineries with very heavy outlays required to protect the environment and to comply with strict and expensive regulations, distributed through a wide network of pipelines, trucks and wholesale outlets and sold at stations in prime locations and taxed heavily.

It is the basic, fundamental building block of the world’s economy. It is unlike any other commodity.

The oil and gas industry provides essential goods at the lowest possible cost with regular reliability while still ensuring a cleaner environment and the industry provides security of supply even though at the same time we are required to manage huge political risk.

What we do isn’t always appreciated by the public and this is part of our industry’s image problem that we need to work on in the next century.

Frankly the focus in today’s economy on globalisation and emerging markets is old news to the oil industry. Ours are global companies investing outside the industrialised companies at the turn of the last century. People need to realise that the energy industry often represents the largest foreign investment in many parts of the world and its interest, insights and experience need to be considered.

Oil is the only large industry whose leverage has not been all that effective in the political arena. Textiles, electronics, agriculture all seem oftentimes to be more influential. Our constituency is not only oilmen from Louisiana and Texas, but software writers in Massachusetts and specially steel producers in Pennsylvania. I am struck that this industry is so strong technically and financially yet not as politically successful or influential as are often smaller industries. We need to earn credibility to have our views heard.

Another concern is the disruptive volatility of the industry. In the new century the oil business needs to learn how to break out of the boom and bust cycles we have experienced over the last century. Perhaps it is part of being a commodity business, but it wreaks havoc with planning processes and can drive smaller companies out of business and, needless to say, creates problems for consumers as well.

One hope might be that the new super majors would use their financial staying power to keep capital spending steady throughout the cycle or even to invest counter-cyclically. This would help smooth out the bumps and of course the financial community could do its part by taking a longer view of financial performance and not pressuring sound companies to cut back during periods of weakness, however unlikely. Technology can help smooth out the cycles by lowering costs. A key challenge for companies in the commodity business is growth and there are basically only two avenues to grow earnings : one is through increasing volume and the other is through improved unit efficiencies. These two options have been driving company strategies.

On the volume side we can see the aggressive production targets that some companies have announced of late. On the unit efficiency side we have the cost cutting targets most firms announced for 1999 and beyond, as well as the mergers designed to generate savings through synergies, economies of scale and reduction in overheads. The view is that in the commodity business the lowest cost producer will be the winner.

In the last century and up to World War Two coal was king and looks to have a lock as the primary source of energy. It was dethroned by oil, mostly due to transportation fuels, but also because oil was less polluting and easier to handle. Coal is still with us today, but oil is clearly dominant. In the new century, will the oil age give way to another source of energy or to new technologies? Some predict natural gas will erode oil’s performance, others say that technology, fuel cells, telecommuting on the internet or some other breakthrough will lessen our dependence on hydrocarbons.

Well, the end of the oil era is not here yet, but changes are afoot and the industry must be ready to adapt to the new century and to the transformations that lie ahead. It will mean showing more speed and agility. As I have outlined today, there are new areas to co-operate in, new risk, new competition, new roles, new integration and a new convergence with power. This will be a challenging environment as we cross the threshold into the new millennium.

You don’t hear our times referred to as the Space Age anymore, instead it’s the Information Age. You will notice they call it the Information Age, not the Knowledge Age. Well, I would conclude today by saying that this industry must be at the forefront of moving into the Knowledge Age. Successful competitors will be those that best manage knowledge. This means technology, expertise, best practices, country, market and competitor intelligence and opportunity assessment. These will be the hallmarks of the energy industry in the new century. I for one am proud to be a part of the industry and I am optimistic about our future in the coming century.

Thank you.

Applause.

Chris Moorhouse :-

Ladies and Gentlemen I would just like to conclude today by giving a vote of thanks to Dick Cheney for coming to speak to us today. I think it’s been a marvellously inspiring speech. I picked up a couple of things : what we do isn’t always appreciated by the public - I definitely feel that from time to time - and that we are the only large industry which has not been politically influential. Finally, as far as the Institute of Petroleum is concerned, I picked up on the remark that the industry must be ready to change and I would add to that its institutions too. So thank you very much and thanks once again to Dick Cheney.

Applause.

-------------------------
Citation: Dick Cheney. Full text of Dick Cheney's speech at the Institute of Petroleum Autumn lunch, 1999.
Original URL: http://www.energybulletin.net/559.html
-------------------------

27 February 2007

Iraqi police selling weapons on black market

By Ahmed Rasheed and Ross Colvin
Reuters, 05 February 2007

BAGHDAD - Like many of his colleagues, Abu Zaid was issued an Austrian-made Glock pistol when he joined the new U.S.-trained and equipped Iraqi police force.

But after narrowly escaping death twice, including being shot at near a polling station in Baghdad during national elections in December 2005, he decided to quit, he said.

"I sold my Glock pistol and my bullet-proof vest for $1,500 so that I can feed my family until I find a safer job. They were mine to sell, after all I had risked my life and faced death," he told Reuters.

Anecdotal evidence, including interviews with arms dealers, suggests that Abu Zaid is just one of many policemen selling the highly prized pistol on the black market, already a shopper's delight for buyers with enough cash.

Everything from the ubiquitous AK-47 assault rifle, the biggest-selling item, to rocket-propelled grenade launchers, sniper rifles and belt-fed medium machine guns are available, many looted from huge arms dumps immediately after the 2003 war.

The polymer-framed 9mm Glock, with a capacity of 15 rounds, is popular with police forces and armies around the world because of its ease of use and reliability. It is now also standard issue for Iraq's 325,000-strong security force.

A 2006 report by the Brookings Institution, a U.S. think tank, said the flow of weapons from the Iraqi forces to the black market and into the hands of militants had left U.S. commanders facing a dilemma.

They had to choose between properly equipping Iraqi security forces and risk seeing the equipment disappear or giving them lower-quality equipment that would "deprive them of the wherewithal to succeed" in combating militants.

"These violations were big and alarming," Iraqi government spokesman Ali al-Dabbagh told Reuters. "I am not saying it is still not happening, but it is getting less."

Nevertheless, the issue is likely to be on U.S. generals' minds as they build up their forces for a planned offensive in the coming weeks against well-armed militants in Baghdad, epicentre of the violence that threatens all-out civil war.

"Iraqi police and soldiers seize weapons in routine raids and then sell them to weapons dealers," said Abu Najim, 45, who says he has been an arms dealer for more than 20 years.

"Some policemen also come to me and offer to sell their Glocks, claiming they have some problems and urgently need money. But my customers avoid buying them. It could bring them big problems if U.S. or Iraqi soldiers find them with them."

PRICES SOAR

With hundreds of people dying violently in sectarian bloodletting every week, many of Baghdad's residents are arming themselves to protect their homes and their neighbourhoods, triggering a surge in gun prices, sometimes 10-fold. Most seek to buy the AK-47, with the Russian-made model more sought after than the more cheaply made Chinese or Iraqi versions. Where the Russian model with a collapsible stock cost $50 in 2003, buyers can now expect to pay closer to $500.

A rocket propelled grenade launcher can still be bought for as little as $100, but its grenades come at $50 apiece.

Adil al-Qaisi has a secondhand store attached to his home in Baghdad which he uses as a cover for his real business -- selling guns. A visit to his shop revealed AK-47s, grenades, ammunition and police-issue body armour hidden in old fridges.

"I bought this from a police officer who quit the police commandos," he said, picking up a blue flak jacket.

"I have frequent visits from policemen wanting to sell their Glocks, too, but it's too risky. If security caught me with them they would call me a terrorist."

U.S. Brigadier General Terry Wolff, who is helping to build the Iraqi army's logistical capacity, said every weapon issued to Iraqi soldiers and police had to be registered in a database.

"I can't say where every weapon is, but we have gone back and rebuilt the weapons database," to include those missed in previous efforts, he said.

The Pentagon said in a report in December that while U.S. trainers tracked how much equipment they had issued to the police, the force lacked the ability to keep a record of them.

With the Iraqi government recently giving Washington a long wish-list of weapons that includes a request for 10,000 more Glocks, U.S. commanders in Iraq could be forgiven for demanding tighter controls before they hand over any more guns.

(Additional reporting by Mariam Karouny)

---------------------------------
Citation: Ahmed Rasheed and Ross Colvin. "Iraqi police selling weapons on black market," Reuters, 05 February 2007.
Original URL: http://www.alertnet.org/thenews/newsdesk/COL344383.htm
---------------------------------

Ruined poppy farmers join ranks with the Taleban

By Tim Albone and Claire Billet
The Times, UK, 27 February 2007

The tractor roared through the field, the plough tearing through the valuable poppy crop as the farmer looked on. A helicopter searched for insurgents and armed police stood watch, their uniforms replaced by robes and turbans to make them less conspicuous.

“The people are unhappy with this eradication campaign; if it goes on they will all join the Taleban,” Dilbar, a poppy farmer in Helmand province, told The Times.

The prospect of such a surge in Taleban numbers is bad news for the 5,000 British troops based in Helmand and 1,400 more heading there after the announcement by Des Browne, the Defence Secretary. The fiercest fighting since the Taleban were overthrown in 2001 came last year, with more than 4,000 people killed, and intelligence reports predict a new offensive this spring.

Poppy eradication is a double-edged sword. Afghanistan provides nine out of every ten grams of heroin sold on the streets of Britain, and officials are determined to stamp out poppy growth. Yet a successful campaign would leave many unemployed as potential recruits for the Taleban.

Afghans, ever the pragmatists, have devised their own solution. “We leave some fields without destroying the poppy so everyone is happy . . . otherwise they will go and support the Taleban,” said Aminullah, 21, a policeman with the eradication force in Helmand.

Although 90 per cent of Helmand’s arable land is turned over to poppy growth, only 550 hectares (1,400 acres) were destroyed in the first week of the campaign. With three months left until harvest the police know that they are fighting a losing battle.

Farmers take huge risks to grow poppy as the market price is 20 times that of wheat. But without aid they have little choice and when the crop is destroyed they are crippled by debt, often having borrowed heavily from landlords to plant the crop. Landlords make no concessions for eradicated crops and the farmers are still expected to pay off their loans.

Smugglers who take the drug out of Afghanistan are also rewarded handsomely for their trade. Very few, if any, smugglers or landlords have been punished, and in southern Afghanistan operate virtually beyond the law. “It will be impossible for us to eradicate the entire poppy. We will need months and months and the poppy will be ready for harvest in only three,” Aminullah said.

In Babaji, a village of mudwalled houses and winding dirt tracks five miles (8km) from Lashkar Gah, the capital of Helmand province, eradication was meant to be in full swing.

“We are growing poppy because we don’t have any other options,” said Abdullah, a poppy farmer, as tractors ploughed part of his field. Over sweet green tea Abdullah, 35, had persuaded a member of the local shura, or council, to leave some crops. The shura member then spoke to the eradication agents and Abdullah’s most valuable crops were saved.

In the district of Panjwayi, in neighbouring Kandahar province, where Nato troops fought the largest antiTaleban battle last September, the agents are reluctant to leave poppy fields untouched.

In the village of Haji Habib police apologised to farmers as the tractors destroyed fields of poppy. “We started here because the village is a Taleban village,” Bismallah Jan, 35 a policeman, said. “But we still feel bad we are destroying their livelihoods.”

---------------------------------
Citation: Tim Albone and Claire Billet. "Ruined poppy farmers join ranks with the Taleban," The Times, UK, 27 February 2007.
Original URL: http://www.timesonline.co.uk/tol/news/world/asia/article1444124.ece
---------------------------------

Watching Afghanistan fall

Stationed with a battle-scarred U.S. Army troop in the mountain region where Osama bin Laden supposedly hides, with the insurgency on the rise, I witnessed why the other war is going to hell.

By Matthew Cole
Salon.com, 27 February 2007

At 9 p.m. on my first night at the U.S. Army base in Kamdesh, I was shaken awake by a 105 mm howitzer round. Then a symphony of incoming and outgoing fire sounded. BO-OM! BO-OM! BO-OM! Tat! Tat! Tat! Pop! Pop! Pop! Pop! Pop! From the pine- and cedar-lined mountain slope that loomed over the base, several insurgents were firing down on us with rocket-propelled grenades and AK-47s. The line of Humvees ringing the base spotted the insurgents and began shooting back. For 10 minutes U.S. forces blanketed the ridgeline above with machine-gun and rifle fire and RPGs. A soldier manning a $500,000 thermal-imaging device (LRAS) the size of a large microwave, spotted the silhouette of Afghans holding weapons and radios -- the mark of a Taliban or al-Qaida insurgent, rather than just an average Kalashnikov-toting Afghan civilian -- and began pulling the trigger of his machine gun.

After the first round of fighting, the soldier yelled that he had confirmed at least one death. "I saw that motherfucker through the LRAS!" he screamed, breathing heavily, his adrenaline high. "I saw him explode into a bunch of pieces! Parts were everywhere!" He smiled.

As the volleys began to subside, Sgt. Matthew Netzel guessed aloud that roughly five insurgents had been killed. "I think there are more up there, but we're not certain yet, 'cause we don't know how many there were to begin with," he said. As they fired, U.S. forces launched slow-falling flares that lit up the wooded area they were firing upon, hoping to illuminate the insurgents' positions. But there were no more insurgents to be seen. The echo of automatic-weapons fire stopped bouncing through the valley and most of the soldiers went back to sleep. It was just another night in Kamdesh. The base averages three attacks per week.

The next morning, a group climbed up the mountainside to look for casualties but found none. "They usually clean their bodies up before we can get to them," Lt. Benjamin Keating, a 27-year-old from Maine, told me. "They will pull the bodies, scrub bloodstains, and sometimes they pick the shells up too. We never know how many we killed or who they were. They're like ghosts." The inability to know how many and who was killed has made it hard for U.S. forces to identify whom they are fighting -- Arabs, Afghans or other groups. When they can, a confirmed kill requires a digital photo of the dead man's face. But those are few and far between.

In November, I traveled with the Army's 10th Mountain Division to Afghanistan's Kunar and Nuristan provinces, the region where Osama bin Laden and Ayman al-Zawahiri have been sighted over the past three years, to see how American forces were fighting the "other" war. What I learned is that the war in Afghanistan is going badly. Three years after U.S. forces secured much of the country and helped 10 million Afghans vote in a presidential election, the country has slid back into a dangerous power vacuum, with the Taliban again competing for control of significant sections of the country. Last November, a CIA analysis of the Karzai government found it was losing control, and American ambassador to Afghanistan Ronald Neumann warned then that the U.S. would "fail" if the plan for action didn't include "multiple years and multiple billions." Our gains, once held firmly, have been lost and the coming year may portend Afghanistan's future, with ominous rumors about a spring offensive by insurgents floating down from the mountains.

Tuesday morning, a suicide bomber killed and wounded Afghans and Americans at the gate to the main U.S. base in the country -- in Bagram -- while Vice President Dick Cheney was visiting the base. Cheney was unhurt, but the incident was a clear sign of the growing strength of the Taliban and other insurgents. Earlier this month, concerns about the U.S. effort in Afghanistan were finally acknowledged in Washington. President Bush announced he would request $10.6 billion in extra aid for Afghanistan and increase the number of troops, especially along the Afghanistan-Pakistan border. "We face a thinking enemy," said Bush. "And we face a tough enemy -- they watch our actions, they adjust their tactics. And in 2006, this enemy struck back with a vengeance." Bush's announcement came after repeated calls from U.S. generals for more boots on the ground and repeated predictions of a spring offensive, pleas for help the military had been making since last summer.

After spending a month along Afghanistan's northeast border with Pakistan, it is clear to me that the help is needed. The region is one of the most wild and ungoverned areas of Afghanistan. The Americans pushed north last summer, part of Operation Mountain Fury, trying to seal off the Pakistan border and find al-Qaida's Arab forces. The border's invisible line, soldiers say, allows high-value targets, like bin Laden, to find sanctuary and a base of operations. What I saw was a skilled but unprepared U.S. force battling literally uphill against an unidentified enemy. 2006 was the deadliest year for coalition forces since the war began, with 191 dead. For the roughly 20,000 U.S. troops in the country, Afghanistan is only slightly less deadly per soldier than Iraq. But while a lack of troops may help the undermanned U.S. effort in the short term, it does not address a larger problem. American forces don't have an adequate understanding of the culture, the many languages or the formidable terrain.

The Kamdesh base is the northernmost American outpost in Afghanistan, in an area of Nuristan so remote that local villagers asked American troops in August, when they arrived, if they were Russian. The base itself is not more than a quarter-mile wide, on a valley floor, next to a clear, trout-filled river. Three-thousand-foot mountains rise above the base on both sides of the river. The base is insecure, susceptible to rocket and small-arms fire from nearly every direction. A row of Humvees, all mounted with grenade-filled Mark-19 machine guns, face the closest mountain, which nearly hangs over the front of the base. When I was there the soldiers hadn't yet named the base, and had made up their own name, Warheight, for the imposing peak. From Kamdesh, a small outpost near the Pakistani border, to Naray, a larger base 25 miles south, to another border outpost called Camp Lybert, the 10th Mountain Division's 3rd Squadron, 71st Cavalry -- the so-called 3-71 -- was supposed to control a 220-square-mile triangle of territory.

The U.S. forces in Nuristan have a multipart mission. First, they are supposed to seal the province's border with Pakistan, an invisible 1,500-mile line that crosses peaks topping 15,000 feet. Second, they are to create security village by village by rooting out insurgents. Third, they are supposed to provide Nuristan with potable water, electricity, schools, passable roads and bridges. The lack of infrastructure in rural and isolated regions has been a key factor in America's failure to date.

The base in Kamdesh was installed in August 2006 as a provincial reconstruction team, one of 12 in Afghanistan. PRTs are supposed to supply the missing infrastructure; thus the troops are nation building at a local level. In Kamdesh, for example, contracts had been given out to engineers and builders for road improvement, bridges, school construction, and installation of micro-hydro turbines that can produce electricity to power neighboring villages. But since their arrival, the team members have been attacked on average of once every two days, with an especially heavy onslaught the first month. No soldiers were killed, but the PRT's mission was initially minimized to simply securing the base and making it safe enough for troops to live there. The building of roads and schools has begun. Lt. Col. Anthony Feagin, who commands the PRT, told me he was cautiously optimistic about his team's work. "We are making gains," he said. "But the gains are fragile." As soon as I arrived on the base, a soldier warned me not to talk openly or loudly about incoming or outgoing convoys. "The workers here are listening," he said. "They don't know much English, but they're reporting troop movements."

Just before I got to Kamdesh, the insurgents had nearly killed several soldiers at the base, including the commanding sergeant major from the 3-71's forward operating base in Naray. He had flown in by Chinook helicopter. After a five-minute tour of the base, during which his Chinook never slowed its rotors or refueled, the sergeant major got back on the chopper. As soon as it lifted off the ground, a rocket erupted from a nearby ridge and hit the spot where the helicopter had been idling. The air shook, concrete and rock flew into the air, but the Chinook, after wavering, didn't come down.

The attack injured no one, but was successful nonetheless. In a guerrilla war, where the measure of victory can simply be preventing the occupiers from winning, an attack like the one in Kamdesh can having far-reaching effects on how the U.S. military operates. The near downing of the sergeant major's helicopter was too close for the Army's comfort. The brass immediately issued an order that helicopters would no longer be allowed to land at the base. The supplies and equipment that the 100 soldiers in Kamdesh needed would now have to travel the 25 miles from Naray via Humvee and truck, a six-hour drive. The insurgents hadn't killed anybody with their rocket, but they had further isolated an already isolated base, limiting how quickly buildings could be built, money distributed and local projects completed.

When I first arrived in Kamdesh, I came by Chinook, but I wasn't allowed to land directly at the base either. Because of the rocket attack that nearly took out the sergeant major, soldiers could travel by chopper only if they were delivered to a nearby observation post -- which meant the top of a 7,000-foot mountain, 3,000 feet above the PRT base -- and all trips had to made at night. The base was an additional three-hour walk through the darkness down dusty ravines.

The Americans believe the forces attacking the base are a combination of local militias and Gulbuddin Hekmatyar's Hezb-e-Islami fighters, estimated at 300 strong. Hekmatyar, the CIA's leading recipient of mujahedin funds during the 1980s, has since aligned himself with bin Laden and become a "high-value target." The CIA and Army Special Forces, who have had some presence in Nuristan since 2005, believed the attacks on the base were being mounted and organized by Hezb-e-Islami cell leaders Abdul Rahman and Abdul Haq. A few nights before I arrived, the CIA and Special Forces planned and executed a raid in the neighboring village of Kamdesh, where they killed Rahman and three others and captured Haq. The mission, according to Army officers apprised of the operation, was a success. Some CIA and Special Forces share Naray with the 10th Mountain, and there are also CIA operatives in Kamdesh. They are the ones charged with hunting for high-value targets like Hekmatyar, bin Laden and al-Zawahiri.

Showing me around the Kamdesh base was Ben Keating, a blue-eyed tree trunk of a young lieutenant on his first foreign deployment. Keating was proud of the 3-71's mission, but thought time was not on the Americans' side. "We've been up here for less than seven months," he told me. He held up a thick book on Alexander the Great's travails in the Hindu Kush mountains. "We have a couple of thousand years of history against us. You do the math." Keating was a history and political science major in college. "I'm not saying we're not doing any good -- we are -- but how long do we plan on staying? And what is the 82nd [the 82nd Airborne replaced much of the 10th Mountain Division this month] going to do with the progress we've made? How do you maintain the successes we've achieved?"

On my first night came the attack that left no bodies. On my second night in camp, half a dozen Afghans were preparing a rocket to fire at the base when U.S. soldiers spotted them. The Americans fired at them for five minutes, then the insurgents climbed the mountainside and retreated into Kamdesh, a village of 20 homes and a mosque several thousand feet uphill. The U.S. troops called for helicopter backup and an Apache arrived within 10 minutes. As the insurgents took cover in a village home, several women and children fled the house, knowing the Americans would likely attack. The Apache, nearly invisible against a starlit sky, flew toward the village, its nose pointed downward a few degrees to get a better aim. For 45 seconds the Apache fired several hundred 30 mm bullets into the house, a steady barrage that lit up the darkened village. The shots killed all the insurgents and also injured six of the fleeing women and children.

In a five-day span, U.S. forces had killed roughly 15 insurgents and injured several more. Local villagers, however, including several I spoke to, believed the Americans had killed an innocent man in the earlier Rahman and Haq raid. "Ahmed was a good man," said a 30-year-old man named Khalil Nuristani. "He was not al-Qaida." In Afghanistan's north, locals use al-Qaida to refer to any anti-U.S. insurgent, a name that came to them by way of the Americans. Nuristani said the innocent man had a childlike intelligence and had been taken advantage of by the insurgents, followers of Rahman and Haq who used his house for operational planning. They had tried to hide there during the raid, which cost Ahmed his life. An intelligence officer on the base disputed Ahmed's innocence, but declined to give an explanation.

The villagers were further incensed when the second Apache raid injured women and children. The afternoon after the raid, they called a shura, or tribal council, with Lt. Col. Feagin and the CIA chief at the base to discuss the security and operations conducted in the valley.

The Americans had been feeling good about their progress. But it was clear that all the collateral damage had further strained a relationship with the locals that was already tense. The shura, a collection of middle-aged men from all the nearby villages, arrived complaining of the deteriorating situation. Forty strong, in stained salwar kameez and flat hats, they sat in rows of white plastic chairs inside an uncompleted building on the base. One man after another stood up to direct his anger, through a translator, at Feagin and the CIA chief. "You told us when you came here that you would not hurt innocent and peaceful people," said a man with an ink-black beard stretching to the middle of his chest. "You have big guns and helicopters with good technology, surely you can tell the difference between those who are innocent and those who are not. You told us if we helped you, the Americans would not harm us. We are prisoners in our villages now!" Several of the men nodded their heads as the man sat back down.

Lt. Col. Feagin, whose chest seemed to point upward, sat still on an unfinished stone wall facing the shura. "There was no intent to target anyone but our enemy," he told them. "If the enemy continues to fight us, many more will die. I am certain." A few gunshots echoed in the valley. Feagin pointed to the direction of the noise and said, "This is part of the problem. The only thing the enemy can bring is fear, intimidation and death." Feagin informed the shura that the injured villagers had been flown to Bagram Air Base to get "the best medicine and treatment the Army has to offer." He then offered to hire more fighting-age men for the Afghan army unit that would soon be posted in the valley.

Lt. Dan Dillow, executive officer of the 3-71's Bravo Company, later told me the counterinsurgency model was the only way to fight the war in Afghanistan. "I don't like civil affairs" -- building roads and schools, offering jobs -- "but you need it out here," he said. You have to give them something. You can't defeat the Nuristanis. They know who is ambushing us and when it's going to happen, but they won't tell us. They have us by the balls and they know it."

Next to speak was the CIA base chief, a man I'll call Arnold. He was dressed like a toy soldier, with black "Terminator"-style sunglasses and an Under Armour T-shirt that even with elastic was stretched to its limits by his muscle. He looked like he should have been lifting weights in a gym. He told the Nuristanis a convoluted story about a wild dog he had killed near his farm in the United States. He had asked the dog's owner, his neighbor, to put the dog down. After several attempts to reason with the neighbor, and with the dog still running amok, Arnold killed the animal. The Nuristanis, he said, were his neighbors, and the Pakistani-trained insurgents were the wild dogs. If the locals didn't take responsibility for keeping insurgents out of their villages, he would be forced to kill the insurgents in their midst. "These [fighters] only know war in their heart," he said, giving his left breast a double tap with a closed fist to make his point.

The shura members responded by looking at the translator quizzically. Later I asked the translator what the villagers had thought of the CIA chief's comments. "They didn't like it" was all he would say.

The 10th Mountain, meanwhile, has suffered its own losses to "wild dogs." Thirty-nine soldiers from the 10th have died since May 2006, 25 by enemy fire, making them the hardest hit U.S. division in the history of the Afghan theater. Camp Lybert is named for Staff Sgt. Patrick Lybert, who fell in combat.

But the troops in Nuristan have also suffered from sheer isolation and the topography of the Hindu Kush. At Lybert (altitude 6,500 feet), the 3-71's Charlie Company had gone 70 days without a hot shower or a hot meal. They have sustained deaths and injuries from hiking and falling. Soldiers who have served in both Iraq and Afghanistan before said their current living conditions are much worse. "Leadership doesn't care about us," said one officer, who requested that his name be withheld to avoid punishment for his comments. "We've gone on mission after mission after mission where we've gone black [run out] on food and water. They tell us, 'Pack light, your mission will only be four days tops.' But then we end up stuck on a mountaintop for two weeks. We didn't have anything, not even tents. If you can't get us off a mountain, don't put us on there."

Several soldiers and officers I spoke with told me they were unprepared for their mission in the north of Afghanistan. No one, it seems, told them they would have to fight a Vietnam-style war at high altitudes. One officer told me the 10th Mountain's limited resources and poor planning frustrated him. (He also asked that his name be withheld for fear of retribution.) "Leadership has failed us," he told me. "They don't give a shit about us. We've been shorted everything we needed. Our training didn't prepare us for this terrain or this mission. We're doing the best we can but we're not getting support." He said the summer of 2006 had been filled with air-assault missions in which Chinooks delivered 20 to 30 troops to a ridgeline with little food or water, and no plan to pick them up.

Places like Gowardesh, the site of Camp Lybert, and Kamdesh are crucial in America's war in Afghanistan. Their proximity to the areas of Pakistan where U.S. intelligence officials believe bin Laden and al-Zawahiri travel has created an instability U.S. forces are trying to counter. "Camp Lybert was built to keep border infiltration routes closed off to the insurgents," said Spc. Timbo Harrell. "They bring weapons and men over from Pakistan and then go back when fighting gets intense. We try to light 'em up if we can see them carrying the weapons. But usually weapons are hidden on donkeys and we're not allowed to engage."

And because U.S, soldiers are allowed to pursue insurgents only six miles into Pakistan, the border acts as an invisible wall, the insurgents' best protection.

Adding to Charlie Company's frustration, it cannot go on manned patrols in the villages below. Capt. Mike Schmidt, the commanding officer, told me the location of the base and size of his troop limited how much he could do. "We depend a lot on locals walking up from the neighboring villages to give us information," he said. "We can't leave the base and do patrols or visit the villages. We don't have enough soldiers. We'd come back and there would be nothing left -- the Afghans would steal everything and the insurgents could take the base."

Again and again soldiers referred to insurgents as "the enemy" or "the bad guys." But the lack of detailed knowledge about whom they were fighting, and why their adversaries were fighting in turn, is troubling. In the north, for instance, the Taliban are weak and unwelcome. And while al-Qaida has local fighters in some valleys, their reach, according to U.S. intelligence officials, has been diminished. Though Army officials quietly say the insurgents are religious fighters, some evidence shows the disputes are local and have little to do with jihad. A translator named Abdul who has worked for the CIA and the Special Forces told me that the biggest threat to American troops in the north, a man named Haji Usman, had been nothing more than a rich timber smuggler before the war. "Now he's enemy No. 1," Abdul said. "He was not a nice guy, but he was not fighting a jihad. He wasn't fighting the Americans. But they took favor with his biggest smuggling competitor, and now he's the No. 1 enemy. I do not understand this."

Back at Kamdesh, the base was gearing up for an incoming convoy. Humvees and LMTVs (for light medium tactical vehicle, a 2.5-ton truck) would be arriving from Naray, carrying ammunition, food, fuel and water along a winding, rock-strewn dirt road. In 2006, insurgents had ambushed many convoys with RPGs, light arms and improvised explosive devices, along a stretch that 3-71 had come to call "Ambush Alley." Several supply trucks driven by Afghans had been torched and pushed into the river. Some U.S. soldiers had been killed, and dozens had been injured in a three-month span. Sometimes security precautions meant it took nine hours, instead of six, to cover the 25 miles between bases.

A listening post above the base began to catch radio communication between insurgents. A man speaking the local Nuristani language began to yell "Allahu akbar!" -- "God is great!" -- before directing his men to attack. "Do not miss. Be accurate. Do not worry, they don't have any planes." He was right. Close air support, the element that gives U.S. forces the biggest advantage over the insurgents, didn't seem to be nearby, and even if planes and choppers were on their way, the radio traffic didn't identify where the insurgents would fire. One of the military intelligence officers who helped relay the information to the convoy expressed frustration. "We know they're going to try to fire, but we don't know from where, so we can't help the convoy out much," he said.

Within a minute, the Americans were hit with several RPGs and rifle fire. A Humvee flipped and was evacuated. A group of soldiers sat around the radio at the Kamdesh control post, listening, hoping the platoon could make it through the "kill zone" without taking casualties. They did. Hours later the convoy reached camp, and there had been only a few minor injuries.

However, the convoy had lost another vehicle in addition to the Humvee, and there were signs that the insurgents were trying new tactics. For the first time, instead of one firing position, the ambush had come from three positions on a mountainside, creating more fire of longer duration and hitting more vehicles. The 3-71 decided convoys would now drive only at night, with night-vision goggles for drivers and no headlights. The insurgents had had another success, and had isolated the PRT base even further. Lt. Ben Keating, for one, admitted a grudging admiration for his adaptable foes. "They're smart. They keep low, never expose themselves for more than 30 seconds to a minute, and then disperse. It's frustrating."

A few nights after I left Kamdesh, word came that a soldier had died in an accident. A team was attempting a lights-out, nighttime convoy to return a truck. The 2.5-ton truck flipped off of a cliff, tossing its two passengers 300 feet down to a riverbank covered with boulders. The Kamdesh soldiers knew the drive would be dangerous. The truck was large and unstable going over a poorly constructed road littered with rocks, boulders and craters. It was the main section of Ambush Alley that Lt. Col. Feagin had ordered rebuilt. But four months later, it was still in bad shape. By the time a group of soldiers got the injured back up the cliff and to a medevac helicopter, one of the passengers, Lt. Keating, had died from his fall, at the age of 27. The men of the PRT base renamed it Camp Keating.

------------------------------------
Citation: Matthew Cole. "Watching Afghanistan fall," Salon.com, 27 February 2007.
Original URL: http://www.salon.com/news/feature/2007/02/27/afghanistan/?source=whitelist
------------------------------------

26 February 2007

Iraq-Syria relations strained anew

By Assad Abboud
Agence France-Presse, 04 February 2007

BAGHDAD (AFP) - Relations between Baghdad and Damascus that were restored just three months ago are already under strain amid allegations Syria is sheltering Iraqi fugitives but being "hostile" to genuine refugees.

Amid a quickening bombing campaign against Baghdad commercial districts that on Saturday saw 130 people killed in the second deadliest attack since the 2003 invasion, Iraqi leaders are voicing growing frustration with what they see as Syria's failure to stem the flow of militants across the border.

Syria has imposed restrictions on Iraqi refugees, suspended flights by the national carrier Iraqi Airways and welcomed Sunni cleric Hareth al-Dari, who is wanted by authorities in Baghdad.

After Saturday's massive truck bomb in a Baghdad market, Iraqi government spokesman Ali al-Dabbagh declared that half of the violence gripping the country was the work of outsiders infiltrating from Syria.

"I confirm that 50 percent of murders and bombings are by Arab extremists coming from Syria," Dabbagh said.

"They come from Syria, we have evidence to prove it. We have already proved it to our brothers in Syria.

"We want to tell all Arabs now that those who call themselves mujahedeen come from Syria, and murder our oppressed population."

Syria reacted angrily to Dabbagh's comments decribing them as "contrary to reality and aimed at harming relations between
Iraq and Syria that Damascus wants to strengthen and develop."

Syria recalled that Iraqi President Jalal Talabani made a six-day visit just last month, the first by an Iraqi head of state in three decades, during which a series of agreements were signed.

"The deals that were struck have laid the basis for the development of relations," an official source told AFP in Damascus. "The comments made by Ali al-Dabbagh are unjustifiable."

After a series of talks during the January visit, Talabani and his Syrian counterpart President Bashar al-Assad expressed a joint "readiness to work together and do everything possible to eradicate terrorism."

But Dabbagh charged Saturday that despite Syrian promises to the contrary, "terrorist groups in Iraq receive all kinds of aid from people set up in Syria."

US commanders have repeatedly accused Syria of turning a blind eye to insurgents smuggling men and materiel across the porous border.

But Damascus counters that it has stopped thousands of would-be fighters, and that attempts to discuss cooperation have been rebuffed by Washington.

The Iraqi government spokesman has also hit out at what he called Syria's "hostile" attitude to Iraqi refugees fleeing the sectarian bloodshed that killed tens of thousands of people last year.

"Syria imposed measures on residency which are very rare. By these measures they will put hundreds of thousands of Iraqis in a dire situation, this is not a friendly attitude, but a hostile attitude," Dabbagh said Friday.

Iraqis were previously granted renewable three-month residency permits but Syria now issues two-week permits that can be renewed just once, upon presentation of documents including a rental contract.

Otherwise, Iraqis must return home for a month before they can apply again.

More than two million Iraqis have sought refuge abroad from the sectarian violence, including at least 600,000 who fled to Syria, according to the UN High Commissioner for Refugees.

Dabbagh said "Iraqi refugees were headed for disaster" in Syria and that recent decisions provoked "anger among Iraqis over the Syrian attitude."

He sharply criticised a meeting of Syria's ruling Baath party that he said "glorified the butcher of Iraqis,
Saddam Hussein," and slammed Damascus for "openly receiving figures with ties to terrorism."

Syria and Iraq, which was governed under Saddam by a rival branch of the Baath party, restored diplomatic relations on November 21, ending a 26-year rupture.

But on January 28, Syrian aviation authorities grounded all Iraqi Airways flights from Baghdad.

Syrian officials said they sought to ensure that Iraqi aircraft met all current international technical and safety standards.

-----------------------------
Citation: Assad Abboud. "Iraq-Syria relations strained anew," Agence France-Presse, 04 February 2007.
Original URL: http://news.yahoo.com/s/afp/20070204/wl_mideast_afp/iraqunrestsyria_070204145356
-----------------------------

Extra 1,400 UK troops to be sent to Afghanistan

By Michael Evans
The Times, UK, 26 February 2007

Substantial British reinforcements are being sent to Afghanistan, consisting of 1,400 more troops, heavy armour and rockets and additional ground-attack aircraft and helicopters.

Des Browne, the Defence Secretary, told the Commons that the extra troops and firepower were needed to support the British force already in Helmand province in the south.

Despite the heavily trailed decision to send more troops, the additional firepower being sent with the extra 1,400 troops came as a surprise and underlined the concerns expressed by military commanders in Afghanistan that they did not have the equipment needed to take on the Taleban if they mount, as expected, a spring offensive.

The list of extra equipment includes Warrior armoured infantry fighting vehicles and multiple-launch rocket systems, both being deployed to Afghanistan for the first time, as well as four more Harrier GR9s, to be used as bombers in a close-air support role for ground troops, and four additional Sea King helicopters. An extra C130 Hercules transport aircraft is also being sent.

The extra battle group announced by Mr Browne will increase the size of Britain’s military presence in Afghanistan to 7,700. This force level will be maintained, under present planning assumptions, until 2009.

The additional troops will mostly be in Helmand. However, the intention is to provide the southern regional commander, soon to be a Briton, Major-General Jacko Page, with a “manoeuvre group” capable of being deployed anywhere in the south.

Mr Browne said he was forced to make his decision about sending another battle group because other Nato partners had failed to offer any extra troops.

He told the Commons: “We believe every Nato partner should be prepared to do more to meet this need (for extra troops). But we must be realistic. I have lobbied our partners (most recently at a Nato meeting of defence ministers in Seville) consistently for more help but it is increasingly obvious that at present, when it comes to the most challenging parts of Afghanistan, only we and a small number of key allies are prepared to step forward.”

Other players in Afghanistan, notably France, Germany, Italy and Spain, are all based in areas where there is little Taleban presence and where fighting is rare, unlike the south and east, where it is a daily occurrence.

The British reinforcements will start to arrive in Afghanistan in May and will continue to deploy through the early summer.

The battle group will consist of the 1st Battalion The Royal Welsh Regiment - formerly the Royal Welch Fusiliers until a recent amalgamation - which will be augmented with a company from the 1st Battalion Scots Guards, equipped with Warrior.

There will also be additional artillery, with a battery of six 105mm light guns from 19th Regiment Royal Artillery, and a troop of guided multiple launch rocket systems from 39th Regiment Royal Artillery.

--------------------------------
Citation: Michael Evans. "Extra 1,400 UK troops to be sent to Afghanistan," The Times, UK, 26 February 2007.
Original URL: http://www.timesonline.co.uk/tol/news/world/article1442932.ece
--------------------------------

Iraqi Cabinet approves draft oil law

By Robert H. Reid
The Associated Press, 26 February 2007

BAGHDAD, Iraq - The Cabinet signed off Monday draft legislation to manage
Iraq's vast oil industry and share its wealth among the Iraqi people, a key U.S. benchmark for progress in this country. The legislation now goes to parliament for approval.

Prime Minister Nouri al-Maliki announced the decision after the Kurds accepted the draft oil bill over the weekend — nearly two months after the government's own deadline for enacting a new oil law.

Al-Maliki hailed the measures as "another foundation stone" in the building of a new Iraq, which relies on oil revenues for about 90 percent of its national budget.

It was unclear when 275-member parliament will vote on the measure. The legislature reconvenes early next month.

All major parties have agreed to work for approval of the measure by May, and some officials expressed hope for an early approval. But there are no guarantees in Iraq's fractious, sectarian political system until the final vote is taken.

"The draft law represents a major breakthrough for Iraq's economic and political transition," said Deputy Prime Minister Brahma Sale, a Kurd. "I very much hope the main political groups will rise to the occasion" and approve the bill in parliament.

Iraq has some of the world's largest petroleum reserves, and supporters hope the legislation will encourage major oil companies to invest billions — if the security situation improves.

However, the oil bill had been bogged down for months in factional infighting between al-Maliki's Shiite-led government and the self-ruled Kurdish administration of northern Iraq over who had the final say in negotiating contracts and managing the revenues.

President George W. Bush's administration, facing growing pressure to end the Iraq conflict, has been urging the Iraqis to finish the new oil law — one of the benchmarks that al-Maliki's government had pledged to meet by the end of last year.

The Iraqis also missed a year-end deadline for legislation on other important things: Establish provincial elections, reverse regulations that exclude many Sunnis from government posts and grant limited political amnesty to some insurgents.

Under the oil legislation, regional administrations will be empowered to negotiate contracts with international oil companies. The contracts will be reviewed by a central government committee in Baghdad headed by the prime minister.

Revenues will be distributed to all 18 provinces based on population size — a concession to the Sunnis whose central and western homeland has relatively few proven reserves. Most of Iraq's oil is in the Kurdish north and Shiite south, and many Sunnis fear they would be cut out of a fair share.

A new law is needed, most outside experts believe, to encourage international companies to pour billions into Iraq to repair pipelines, upgrade wells, develop new fields and begin to exploit the country's vast petroleum reserves, estimated at about 115 billion barrels.

But the haggling over the law went to the heart of the Iraqi crisis — the failure of religious and ethnic parties to compromise in the interest of saving the nation.

Without such compromises, U.S. commanders doubt that military crackdowns and the current U.S. and Iraqi security operation can produce long-term stability.

According to Iraqis familiar with the deliberations, the draft law would offer international oil companies several methods to invest, including production-sharing agreements. Those would give U.S. and other international companies a substantial share of the oil revenues to recover their initial investments and then allow them big tax breaks.

That angers some Iraqis, who believe foreigners will get too much control of the nation's wealth.

Some critics of the law believe the draft gives the regions too much control. The Kurds currently have the only self-governing region in Iraq, although the 2005 constitution allows other areas to form them too, such as the Shiites in the oil-rich south.

If implemented, "The balance of power in the management of Iraq's oil and gas resources would have shifted alarmingly from the center to the regions," former oil official Tariq Shafiq, who helped draft an early version, told an oil seminar in Amman, Jordan, this month.

The tortuous negotiations are reminiscent of the intense American arm-twisting, public pressure and backroom dealmaking that have pushed nearly every step in Iraq's political transformation since the U.S.-led invasion nearly four years ago.

The process sometimes has produced agreements that enabled Washington to declare success but ultimately created a new set of problems — such as a divisive 2005 election that invigorated the Sunni insurgency, and a new constitution that the U.S. now acknowledges must be amended substantially to bring peace.

Some critics fear the oil law will become the latest example.

"The draft law is very dangerous," former oil official Faleh al-Khayat told the Amman seminar. "It should not be implemented at this time."

---------------------------------
Citation: Robert H. Reid. "Iraqi Cabinet approves draft oil law," The Associated Press, 26 February 2007.
Original URL: http://news.yahoo.com/s/ap/20070226/ap_on_re_mi_ea/iraq_oil_law
---------------------------------

23 February 2007

Distrust, fear a year after Iraq mosque bombing

The Samarra attack has led to a life that's 'unbearable,' Iraqis say.

By Christian Berthelsen
Los Angeles Times, 23 February 2007

BAGHDAD — On a gray, drizzly day in the mostly Shiite Muslim neighborhood of Karada, one of this capital's last bastions of relative stability, sheepherder Ahmed Jassim Safee reflected on how life has changed in the year since sectarian warfare erupted with the bombing of the Golden Mosque in Samarra.

"We used to go to sell our livestock in Fallouja, Ramadi and Rutbah," Safee said of Iraqi cities that are now Sunni hotspots practically off-limits to Shiites. "The shrine bombing has resulted in the drawing of borders, and now we cannot travel freely even within the limits of one city or town because you don't know when you're going to be targeted or for what reason."

The Golden Mosque held the tombs of imams who were descendants of the Muslim prophet Muhammad and regarded by the Shiite sect as his rightful successors. U.S. and Iraqi officials have committed to rebuilding the mosque's bomb-damaged golden dome, but it is in a Sunni-dominated area and the work is viewed as too dangerous to undertake at the moment.

Before the mosque bombing, anger and violence in Iraq had largely been focused on the U.S.-led forces occupying the country in the wake of the 2003 invasion.

But the Feb. 22, 2006, attack on one of the nation's holiest Shiite mosques overshadowed Western failures and transgressions, including the Abu Ghraib prison scandal and reconstruction lapses, that occurred after the fall of Iraqi President Saddam Hussein. It set off a convulsion of sectarian warfare that continues mostly unabated to this day and starkly divides Iraq in ways that were largely buried before.

Now, one year on, amid the latest version of a security plan intended to restore calm, bombed-out buildings scar Baghdad and Iraqis live in fear of one another. Several people asked to discuss their feelings on the shrine bombing and their hopes for the future declined to do so. Those who were willing to talk said they badly wanted the plan to work and for peace to return. But their faith in such an outcome varies widely.

As his 14-year-old son, Abbas, slaughtered a sheep for a customer and dozens of other animals milled around, Safee, 37, said he was pessimistic. He noted that hundreds of people have been killed even after the new security effort was launched early this month and that on Wednesday the government announced it had captured Sudanese militants entering the country.

"What kind of security plan is this?" Safee said. "Life after the shrine incident in Samarra has become unbearable and worse than ever. It has become very dangerous to the extent that even a .50-caliber machine gun wouldn't do you good for protection."

The distrust is not limited to Shiites. Sunnis too believe sectarian tensions have long-lasting ramifications, and fear for the future.

"I don't think that the shockwaves of this incident have died down yet, and I don't think that they will unless a more secular government comes into power," said Zaid Jumaili, a 33-year-old electrical engineer from a predominantly Sunni neighborhood in west Baghdad.

"These explosions basically got rid of any inhibitions that the people had before it. It's all about revenge. Ordinary Shiites started attacking or killing ordinary Sunnis, and ordinary Sunnis who had nothing to do with [religious militants] started doing the same thing as a reprisal."

Still, many Shiites and Sunnis share the view that the attack was the work of foreign agents determined to foment a holy war in Iraq, and resent the way it has divided their country. Saif Lahaybi, a 23-year-old Sunni engineering student, said he had to end a relationship with a Shiite girl because of the divisions, and he and Shiite friends are no longer able to visit each other's neighborhoods to socialize.

"No doubt the bombing of the shrine in Samarra is not accepted, whether by Shiite or Sunnis," he said. "We were like one, living together and sharing neighborhoods."

But there are those who hold out hope.

Mohammed Thamir, 28, who on Thursday sat in his darkened luggage store without electricity, said he believed the new security effort would bring an end to the violence.

"It was a big tragedy and what happened is unfathomable, but I am optimistic that we will be able to surpass these hard times," he said as the light from a battery-powered fluorescent bulb glinted off the metal fixtures of his suitcases. Business was brisk after the bombing, as Iraqis bought baggage to flee the country. Now, he said, sales have slowed as people give the new plan a chance to work.

"'Hopefully this security plan will put an end to this violence," Thamir said. "I have faith that it will work. It's not just Iraqis; the whole international community has interest in the success of this plan."

Shujaa Abdul-Ilah, the 25-year-old owner of a store that sells leather shoes and coats, said the violence had forced him to close his shop five hours earlier each day, but that the crackdown had made him feel safer.

He said that despite the violence and sectarian tension, "I don't think that it will stay like that. We are all brothers regardless of our religion or sect. We have lived in Iraq for numerous generations."

-------------------------------------
Citation: Christian Berthelsen. "Distrust, fear a year after Iraq mosque bombing," Los Angeles Times, 23 February 2007.
Original URL: http://www.latimes.com/news/nationworld/world/la-fg-voices23feb23,0,4390097.story?coll=la-home-headlines
-------------------------------------

Scramble for Iraq's oil begins as troops start to pull out

By Saeed Shah
The Independent, 23 February 2007

We are about to find out if the invasion of Iraq really was a war for oil. The country is on the verge of passing a petroleum law, which will set down rules for investing in its oil industry. That will set off a race among the foreign oil giants, scrambling for their slice of Iraq's vast oil riches. Britain's two world-leading oil companies, BP and Shell, both say they want to enter Iraq. Exxon, ConocoPhillips, Total, Russia's Lukoil and the Chinese will also form part of the rush.

Even while the security situation in Iraq remains dire, it seems the prize will be just too great for the oil majors to resist. The country has proven reserves of 115 billion barrels of oil, around the same as Iran, but it is thought that its actual reserves could be anywhere up to 300 billion barrels - which would make it bigger than Saudi Arabia. Much of the west of Iraq remains unexplored.

John Teeling, chairman of Petrel Resources, the explorer listed on London's AIM market which has had interests in Iraq since 1997, says: "Iraq has 70 discovered, undeveloped fields. You'd die for any one of them. Even the small ones have a billion barrels. If this isn't the holy grail, it's right next door to it."

It is hard to exaggerate the scale of the opportunity in Iraq, especially given the fact that foreign companies are, essentially, shut out of the rest of the Middle East and Russia is increasingly hostile to international players.

"It costs $1 a barrel to get oil out in Iraq. If you're getting $60 for it, that's good economics. You don't have to go to Harvard to figure that out," Mr Teeling says.

War-torn Iraq is currently producing less than 2 million barrels a day, well down on the 2.8 million barrels before the 2003 invasion by the US and Britain.

Tariq Shafiq, a former executive in the Iraq National Oil company and one of the experts called in to draft the country's petroleum law, says Iraq could "very easily" get to 3.5 million barrels a day. He says it is "physically" capable of producing 10 million barrels a day - around the current output levels of Saudi Arabia, the pre-eminent producer today.

Mr Shafiq, who now works for the consultants Petrolog & Associates, says that foreign involvement in Iraq's oil industry is needed for its technical knowledge, not capital - given the high price of oil, investment is pretty much self-financing. "Iraq has been left behind," he says.

The former president Saddam Hussein cut Iraq off from foreign oil technology, first by pursuing the war with Iran in the 1980s, then the international sanctions of the 1990s. Advanced oil recovery techniques, such as water injection, passed the country by.

The petroleum law, which is now in its third draft and is expected to go before the Iraqi parliament soon, allows wide-ranging and deep involvement in the sector. It envisages three type of international contract - buy-backs, production-sharing agreements (PSAs) and service contracts.

The PSAs are the deals most favoured by big oil, as they allow the foreign company to book the reserves. Buy-back contracts typically require upfront investment from the international company, with a guaranteed rate of return to repay the money.

Mr Shafiq says that the draft law does not specify a figure for the permitted rate of return, it talks of a "fair" return. This he interprets as being no more than 20 per cent.

The law awards much power to the regions for negotiating contracts, with the central government given an oversight role, a feature that did not exist in the Mr Shafiq's original draft and one that he believes will play into the fracturing of Iraq. However, the oil revenues will be shared between the provinces, according to their populations, not their oil resources - that gives the oil-poor Sunni areas a big stake in the success of the industry.

While the oil industry's majors and super-majors are not currently in Iraq, the minnows such as Petrel and the Norwegian group DNO, which is actually producing oil in the relatively safe Kurdish north, have shown that it is possible to operate in the country.

The lack of a law setting out the rules for the oil industry and the extreme security problems have kept the big operators formally away. But they have been active behind the scenes and, once the petroleum law is enacted, it is expected that all of them will rush to the Iraq oil ministry's negotiating table.

Shell and BP, for instance, have obtained precious knowledge of two of Iraq's biggest oilfields by providing free assistance. These projects do not involve having company personnel on the ground in Iraq. BP has studied the reservoir data from the Rumaila field in the south, to advise on how to maximise future production.

BP says: "Once the security situation permits, and the Iraqis seek assistance, we would consider opportunities there, as we would elsewhere in the world."

Shell is currently undertaking a reservoir study of the Kirkuk field, in the north, "in order to assist the Ministry of Oil to enhance production from this field".

Shell is more forthright. It says: "Shell has a very long history of working in Iraq. We would welcome the opportunity to help Iraq re-build its energy industry, but we will only enter the country once security, living and working conditions are improved. We have had discussions with Iraqi officials from the Ministry of Oil from outside the country, in order to better understand the complex situation in Iraq. We have experience with the technical and operational challenges that Iraq will face in future. This is based on our experience with similar situations in the Middle East. We aspire to establish a long-term presence in Iraq and a long-term relationship with the Iraqis, including the newly elected Government."

The Western oil majors will almost certainly have to wait until the security situation in Iraq improves before they are prepared to put their people on the ground. However, they are likely to tie up the Ministry of Oil in negotiations over projects until that happens - assuming that Iraq does not simply dissolve into all-out civil war. And, as the south and the north of the country, where most of the oil lies, are relatively less violent, it may be possible to operate in the country even while the central region around Baghdad continues to be a bloodbath.

The Russians and Chinese are almost certain to send their people in, no matter what the risks. Here the US group ConocoPhillips has pulled off a clever arrangement. Lukoil negotiated with the regime of Saddam Hussein for rights to the giant undeveloped West Qurna field. ConocoPhillips has taken a 20 per cent equity stake in Lukoil - a deal approved by the Kremlin - and it has apparently negotiated a 50 per cent share in Lukoil's West Qurna interest. So the Russian personnel would take the risks but Americans would still benefit.

Iraq's oil wealth is just too great for the majors to miss. The question is not if they will go in, but when.

-------------------------------
Citation: Saeed Shah. "Scramble for Iraq's oil begins as troops start to pull out," The Independent, 23 February 2007.
Original URL: http://news.independent.co.uk/business/analysis_and_features/article2296884.ece
-------------------------------

Revealed: The true extent of Britain's failure in Basra

By Patrick Cockburn
The Independent, 23 February 2007

The partial British military withdrawal from southern Iraq announced by Tony Blair this week follows political and military failure, and is not because of any improvement in local security, say specialists on Iraq.

In a comment entitled "The British Defeat in Iraq" the pre-eminent American analyst on Iraq, Anthony Cordesman of the Centre for Strategic and International Studies, in Washington, asserts that British forces lost control of the situation in and around Basra by the second half of 2005.

Mr Cordesman says that while the British won some tactical clashes in Basra and Maysan province in 2004, that "did not stop Islamists from taking more local political power and controlling security at the neighbourhood level when British troops were not present". As a result, southern Iraq has, in effect, long been under the control of the Supreme Council for Islamic Revolution in Iraq (Sciri) and the so-called "Sadrist" factions.

Mr Blair said for three years Britain had worked to create, train and equip Iraqi Security Forces capable of taking on the security of the country themselves. But Mr Cordesman concludes: "The Iraqi forces that Britain helped create in the area were little more than an extension of Shia Islamist control by other means."

The British control of southern Iraq was precarious from the beginning. Its forces had neither experience of the areas in which they were operating nor reliable local allies. Like the Americans in Baghdad, they failed to stop the mass looting of Basra on the fall of Saddam Hussein and never established law and order.

American and British officials never appeared to take on board the unpopularity of the occupation among Shia as well as Sunni Iraqis. Mr Blair even denies that the occupation was unpopular or a cause of armed resistance. But from the fall of Saddam Hussein, mounting anger against it provided an environment in which bigoted Sunni insurgents and often criminal Shia militias could flourish.

The British forces had a lesson in the dangers of provoking the heavily armed local population when six British military police were killed in Majar al-Kabir on 24 June 2003. During the uprising of Mehdi Army militia of Muqtada al-Sadr in 2004, British units were victorious in several bloody clashes in Amara, the capital of Maysan province.

But in the elections in January 2005, lauded by Mr Blair this week, Sciri became the largest party in Basra followed by Fadhila, followers of the Mohammed Sadiq al-Sadr, the father of Muqtada al-Sadr. The latter's supporters became the largest party in Maysan.

Mr Cordesman says the British suffered political defeat in the provincial elections of 2005, and lost at the military level in autumn of the same year when increased attacks meant they they could operate only through armoured patrols. Much-lauded military operations, such as "Corrode" in May 2006, did not alter the balance of forces.

Mr Cordesman's gloomy conclusions about British defeat are confirmed by a study called "The Calm before the Storm: The British Experience in Southern Iraq" by Michael Knights and Ed Williams, published by the Washington Institute for Near East Policy. Comparing the original British ambitions with present reality the paper concludes that "instead of a stable, united, law-abiding region with a representative government and police primacy, the deep south is unstable, factionalised, lawless, ruled as a kleptocracy and subject to militia primacy".

Local militias are often not only out of control of the Iraqi government, but of their supposed leaders in Baghdad. The big money earner for local factions is the diversion of oil and oil products, with the profits a continual source of rivalry and a cause of armed clashes. Mr Knights and Mr Williams say that control in the south is with a "well-armed political-criminal Mafiosi [who] have locked both the central government and the people out of power".

Could the British Army have pursued a different strategy? It has been accused of caving in to the militias. But it had little alternative because of the lack of any powerful local support. The theme of President Bush and Mr Blair since the invasion has been that they are training Iraqi forces.

Police and army number 265,000, but the problem is not training or equipment but lack of loyalty to the central government. Vicious though the militias and insurgents usually are, they have a legitimacy in the eyes of Iraqis which the government's official forces lack. Periodic clean-ups like "Corrode" and "Sinbad" do not change this.

There is no doubt the deterioration in the situation is contrary to the rosy picture presented by Downing Street. Messrs Knights and Williams note: "By September 2006, British forces needed to deploy a convoy of Warrior armoured vehicles to ferry police trainers to a single police station and deliver a consignment of toys to a nearby hospital." Some British army positions were being hit by more mortar bombs than anywhere else in Iraq. There was continual friction with local political factions.

Why is the British Army still in south Iraq and what good does it do there? The suspicion grows that Mr Blair did not withdraw them because to do so would be too gross an admission of failure and of soldiers' lives uselessly lost. It would also have left the US embarrassingly bereft of allies. Reidar Visser, an expert on Basra, says after all the publicity about the British "soft" approach in Basra in 2003, local people began to notice that the soldiers were less and less in the streets and the militias were taking over. "This, in turn, created a situation where critics claim the sole remaining objective of the British forces in Iraq is to hold out and maintain a physical presence somewhere within the borders of the governorates in the south formally left under their control, while at the same minimising their own casualties.' Mr Visser said.

In other words, British soldiers have stayed and died in southern Iraq, and will continue to do so, because Mr Blair finds it too embarrassing to end what has become a symbolic presence and withdraw them.

Other premiers' foreign policy misjudgements...

Lord Salisbury The Boer War 1899-1902

The discovery of gold in the two independent Boer republics of Transvaal and Orange Free State led Britain to flex its military muscle in South Africa. There was enthusiastic support for the war back home in Britain, giving Salisbury a landslide in the 1900 general election. However, support began to wane as the war dragged on, and there was outrage at Britain's brutal tactics - although they led to the Boers' surrender in 1902. Despite the apparently successful outcome, it contributed in large part to the catastrophic defeat for the Conservatives in 1906, and signified the beginning of the end for the British Empire.

David Lloyd George The Easter Rising 1916

Prior to the 1916 Easter Rising, there had been little appetite among the Irish for armed struggle. But the execution of the leaders of the uprising, and subsequent atrocities, most notably the 1921 Croke Park massacre, only served to strengthen the resolve of those fighting for independence. What had begun as a small-scale armed rebellion escalated rapidly. Sinn Fein won 70 per cent of Irish seats in the 1918 general election, which was followed by an upsurge in violence, retaliations, a declaration of independence, a war of independence, and finally, in 1922, independence itself.

Anthony Eden The Suez Crisis, 1956

Covertly arranged in collusion with France and Israel, the mission was to regain control of the Suez canal (nationalised by Egypt), and to overthrow the nationalist Nasser regime. While the initial outcome was successful from a military point of view, and with minimal British casualties, the perception that Britain and France were seeking some kind of colonial resurgence did not sit well in Washington. Eisenhower made it clear to Eden that he did not want the operation to go ahead, and was willing to back it up with economic threats. Eden caved in, ending his career and Britain's status as world superpower.

Robert Peel The First Anglo-Afghan War 1839-42

The mission to curb Russian influence by deposing Dost Mohammed and restoring former ruler Shoja Shah, was launched to strengthen British interests. The British took Kandahar, Ghazni and Kabul, captured Dost Mohammed and restored the Shoja to the throne. Their job seemingly done, they withdrew, leaving a garrison of troops and two envoys in Kabul. In 1841, however, there was an uprising, and the garrison was forced to surrender. The retreating British troops and civilians were massacred, bolstering Afghanistan's growing reputation as a graveyard for foreign armies.

----------------------------------
Citation: Patrick Cockburn. "Revealed: The true extent of Britain's failure in Basra," The Independent, 23 February 2007.
Original URL: http://news.independent.co.uk/world/middle_east/article2296829.ece
----------------------------------