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Iraqi forces took Baiji from Islamic State, but the former boom town may be doomed

Iraqi forces took Baiji from Islamic State, but the former boom town may be doomed
Iraqi forces patrol in Baiji on Oct. 20, 2015, after the government retook control of the oil refinery complex from Islamic State extremists. (Idris Okuducu / Anadolu Agency)

The three Iraqi security force members were perched atop a bridge overlooking the highway bisecting the remains of former boomtown Baiji, shooing away any vehicle without armor plating.

Their eyes compulsively scanned the industrial sprawl of the nearby oil refinery, the city's raison d'etre, silent and gutted after years of fighting between extremists and pro-government forces, and pillaging.

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“We have clashes here every day,” said one of the men, a federal police officer who identified himself only as Commissioner Alaa. “Islamic State fighters come down from the mountains and sneak up on us.” 

The city, once a bustling home to 200,000 people, is so utterly destroyed that there is little, if any, hope of rebuilding. It is deserted aside from security forces essentially left to defend a memory of hope amid the remains of buildings wrecked by a hailstorm of burning metal chunks caused by the battles.

Many observers believe Baiji and its refinery, 125 miles north of the capital, Baghdad, will never be rebuilt, destined to remain relics of a countrywide economic arrangement that no longer holds, and a symbol of the government's ability to do little more in some places than to try to keep away insurgents.

It would cost billions of dollars to repair the refinery alone — money that the government, which is facing a budget crisis, does not have. The pipeline network, which once extended to essential sources such as the nearby Ajil oil field, has also been severely disrupted, according to Oil Ministry spokesman Asim Jihad, and many areas where it passes remain under Islamic State control.

But even if the refinery could be repaired, many question whether it is economically feasible to do so in Iraq's current political climate, where the country's main sects have an increasingly fractious relationship.

Iraqi fighters look at the damage Oct. 17, 2015, after security and allied paramilitary forces recaptured a refinery complex from Islamic State extremists in Baiji.
Iraqi fighters look at the damage Oct. 17, 2015, after security and allied paramilitary forces recaptured a refinery complex from Islamic State extremists in Baiji. (Ahmad al-Rubaye / AFP/Getty Images)

Much of Baiji's output relied on a steady supply of crude from the northern province of Kirkuk — which reportedly has about 10% of the country's total reserve of 140 billion barrels — an arrangement that worked when Iraq was unified under the rule of strongman Saddam Hussein. It is unlikely, however, to continue; the semiautonomous Kurdish administration in the north is intent on severing ties with the central government and keeping the oil.

"The calculations for the government are that Kirkuk's oil is now disputed and won't necessarily be part of the central government's share," said Abbas Anbori, an advisor to the Iraqi parliament's Foreign Relations Committee. "That, along with the high cost of the damage, means ... it may be better to just cancel Baiji … instead of relying on a facility that one day may be again under Daesh and in any case may not benefit the central government," he said, referring to Islamic State by its Arabic acronym.

When the refinery came online in 1982, it was the biggest in Iraq, with four refining units installed in a 10-square- mile complex with easy access to the Baghdad-Mosul highway, the backbone of the country's road system. Capable of producing 310,000 barrels of oil a day, more than a third of Iraq's domestic energy needs, it gave rise to a host of ancillary industries including fertilizer and vegetable oil factories and a power plant.

The refinery's location along the Tigris River was key to its success: It stood at the center of a spiderweb of pipelines and was the starting point from where roughly 500 tankers would distribute $10 million worth of oil a day throughout the country, according to industry figures in 2008.

"Back in the 'good old days,' the government had a grand energy strategy as to how Iraq would look and it was all about linking the country," Michael Knights, an Iraq expert with the Washington Institute for Near East Policy, said in a recent phone interview.

During the U.S.-led invasion of Iraq in 2003 and the vicious sectarian bloodletting that followed, the location also became a liability.

Baiji is the northernmost point of the so-called Sunni Triangle (Ramadi and  Baqubah are its other ends), a Sunni Muslim-dominated area that was a major support base for several insurgent groups fighting the Americans, including the progenitor of Islamic State, the Islamic State of Iraq.

The refinery proved a great draw for the insurgents, who would hijack tankers, bleed pipelines or bribe officials to get at the oil. In 2008, the Pentagon estimated as much as 70% of Baiji's production, $2 billion in fuel derivatives, disappeared into the black market every year.

But by 2012, the area had stabilized enough for the Oil Ministry to invest in millions of dollars of spare parts for the refinery and a plan to bring its production levels to capacity, said Patrick Osgood, Kurdistan bureau chief for Iraq Oil Report, an industry news service.

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Meanwhile, in the 10-year plans of the provincial government, Baiji was to become its largest population center.

"Simply, it was the economic lifeblood of our province,"  said Ismail Haloob, deputy governor of Salahuddin province.  "Half of our revenue was from there."

All that changed in 2014, when Islamic State blitzed through large parts of Iraq, gaining control of cities such as Mosul, Tikrit and Baiji.

A hard fight began for the refinery. Both sides launched at least 10 major offensives on the area over a period of 16 months, before a combined force of Iraqi government troops and Shiite Muslim factions backed by the U.S.-led coalition ousted the group in October 2015.

But the threat of violence by Islamic State fighters who emerge from the nearby Makhoul and Hamreen mountains has persisted, even though the refinery appears dead.

"We are now in a defensive position, but it's not secure," said a commander with the League of the Righteous, a pro-government Shiite faction that is the refinery's main security force, who used the nom de guerre Abu Ghassan for security reasons.

The commander refused to allow journalists into the refinery because of the proximity of Islamic State fighters, but he described a facility sprinkled with booby traps that was all but destroyed in the fighting. Wide-scale looting, some of which has been blamed on the cadres of the league, has left the place plundered.

"It's not that it's not working, it's that it will never work … you can say forever," he said.

Knights said the government has focused on building new refineries in Karbala, Baghdad, Maysan and Samarra, areas it is confident of controlling.

Without the refinery in Baiji, there is little reason for residents to return and no incentive for the government to do more than secure the area from militants.

"It's not just that Baiji is a possible bastion of the enemy. It's that the economic structure of the country has disintegrated,"  Knights said. "Baiji is a symbol of this … and so the country stays like a broken-backed man."

Bulos is a special correspondent.

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