VZCZCXYZ0001
RR RUEHWEB

DE RUEHGB #2052 1851133
ZNR UUUUU ZZH
R 031133Z JUL 08
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC 8109
INFO RUCNRAQ/IRAQ COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEKJCS/SECDEF WASHINGTON DC
RUEKJCS/DIA WASHDC
RHMFISS/HQ USCENTCOM MACDILL AFB FL
RHMFISS/HQ USEUCOM VAIHINGEN GE

UNCLAS BAGHDAD 002052 
 
SENSITIVE 
SIPDIS 
 
FOR TFBSO AND USAID 
 
E.O. 12958: N/A 
TAGS: ENRG PGOV EPET EINV IZ
SUBJECT: NINEWA: SULFUR PLANT REPRESENTS HUGE UNTAPPED 
POTENTIAL 
 
¶1. (U) This is a Ninewa Provincial Reconstruction Team (PRT) 
message. 
 
¶2. (SBU) Summary: The Mishraq Sulfur Plant in south-central 
Ninewa Province contains half a billion tons of recoverable 
sulfur.  Repairs and reconstruction to the plant following a 
fire in 2003 would be inexpensive when compared to revenues 
generated from potential production and sale of one to two 
million tons per year.  Worldwide sulfur demand for steel, 
rubber fertilizer and other products and 
chemical/petrochemical processes is high.  No repairs to the 
facility have been made to date, but sales of stockpiled 
sulfur are occurring to unidentified buyers.  Employment at 
the plant when it was in operation was 1,880 and is now about 
600, including security.  End Summary. 
 
Damaged by Fire and Never Repaired 
---------------------------------- 
 
¶3. (SBU) The Mishraq Sulfur Plant, originally built in the 
1970s by Freeport McMoRan and under the control of the 
Ministry of Industry and Materials, sits atop 500 million 
tons of sulfur.  The sulfur is extracted through the Frasch 
Process, pumping superheated water and hot air into the 
ground through the outermost two of three concentric pipes 
and retrieving the sulfur foam that is forced to the surface 
through the innermost pipe.  While most sulfur worldwide is 
produced as a byproduct of crude oil refining, the Frasch 
process is still used to extract sulfur in parts of Texas and 
Louisiana. 
 
¶4. (SBU) The plant was destroyed by fire in 2003 and has not 
been repaired. Since 2003 the price of sulfur has risen from 
around USD 40 per ton to between USD 400 and USD 500 per ton. 
 Sulfur is used in the production of steel, fertilizer, 
rubber, explosives, animal feed, paint, inorganic chemicals, 
pharmaceuticals and other products and in chemical processes 
for refining petroleum and sugar. 
 
Current Plans for Rehabilitation, Sales 
--------------------------------------- 
 
¶5. (SBU) The sulfur harvested at the plant is slightly 
contaminated with oil and requires additional purification. 
Plant management estimates replacement cost of the 
purification facility at USD 50-60 million, and a like amount 
to restore the rest of the plant, for a total of USD 100-120 
million. Baghdad-based ministry officials have mentioned at 
various points in the last year that they plan to inject some 
funds to rehabilitate and eventually sell off the plant, 
though local officials have seen no action yet.  Employment 
at the plant when it was in operation was 1,880 and is now 
about 600, including security. 
 
¶6. (SBU) Management estimates of leftover product at the 
plant have varied over the last year between hundreds and 
hundreds of thousands of stockpiled sulfur ready for export. 
Coalition Forces have seen as many as 70 trucks at a time 
leaving the facility, though no one has information on who is 
buying that product. 
 
Comment: Need Guidance from TFBSO/USAID 
------------------------------ 
 
¶7. (SBU) A full inspection by international and Iraqi 
engineers and industry experts familiar with current sulfur 
technology and marketing could indicate whether the facility 
represents an opportunity for immediate employment, future 
privatization and profitable U.S. investment.  PRT would 
appreciate reaction/guidance from TFBSO/USAID, specifically 
regarding the advisability of a possible USG-facilitated 
visit by international customers of bulk sulfur and possible 
paired financing for equipment rehabilitation. 
 
CROCKER