Iraq awards Thai rice, oil firms crude quotas

Iraq awards Thai rice, oil firms crude quotas

BANGKOK (Reuters): Iraq has rewarded a Thai rice exporter, a
steady shipper of rice to Iraq under a United Nations food for
oil program, with a quota for the import of three million barrels
of Basra light crude oil.

It also granted state-owned Petroleum Authority of Thailand
(PTT) with a quota for one million barrels of similar crude.

The two firms were offered the oil at normal market posted
prices without the additional premiums they would have to pay in
the open market, PTT said.

Chaiyaporn Rice Co and PTT said on Monday that Iraq had given
them the quota to buy the crude within the first half of 2000.

"We have (a) long business relationship with Iraq dating back
about 20 years. We have been its supplier of rice and other
commodities," Paiboon Kuansongthahe, a senior executive at
Chaiyaporn, told Reuters.

He declined to disclose terms for the crude offered but said
Chaiyaporn would resell it to refineries in the Far East.

Chaiyaporn was now shipping 80,000 tons of 10 percent white
Thai rice to Iraq between December and February.

The rice was being shipped to Iraq under the UN program
covering the cash-strapped Middle East country's food imports.

"The current shipment is part of the December 17 United
Nations resolution which covers a six-month period from last
month," Paiboon said.

Iraq bought 214,983 tons of Thai rice in 1999, up from 160,150
tons a year earlier.

Surong Bulkul, senior executive vice president of PTT, told
Reuters his company also obtained the Iraqi crude as a goodwill
gesture from Iraq.

"This represents a favorable government-to-government gesture
toward Thailand. We plan to import the crude in one single
shipment in February because Iraq has a reasonable surplus at
this time," he said.

Iraq offered the crude oil to PTT and Chaiyaporn at the normal
market posted price, which would enable the Thai oil firm to save
a premium of about 30 U.S. cents per barrel it would have to pay
in the open market, Surong said.

Earlier the Thai foreign ministry statement said PTT would
save about $300,000 in crude import bills because of the special
quota.

Surong said: "Iraq offers the same direct sale terms to
countries that it views politically friendly.

"China, Malaysia and Vietnam have received bigger Iraqi quotas
than us because of their more friendly voting records on past
U.N. sanctions than the West."

He believed Chaiyaporn had resold its Iraqi quotas in the
international market.