Iraqi oil pipeline workers strike

BASRA, Iraq, June 5 (Reuters) Workers at the Oil Pipeline Company in southern Iraq began a strike yesterday demanding the government improve their pay, the company spokesman said.

Faraj Mizban said about 600 workers are taking part in the strike and that they have shut two main pipelines which carry refined oil products to Baghdad and to the southern cities.

Oil Ministry spokesman Asim Jihad said the strike will not have any effect on crude oil exports from the south, vital for Iraq's economy.

''The workers have started a strike objecting to the lower yearly profit they get,'' he told Reuters.

''It has caused a halt (to the flow) of oil products..to Nassiriya, Kerbala and Baghdad,'' he added.

Mizban said the workers wanted pay rises from the company branch in Basra to be financially and administratively independent from the centre in Baghdad.

Basra, richest city in Iraq and its gateway to the Gulf, has been the scene of a power struggle among Shi'ite factions seeking control of its oil wealth.

Iraq, which depends heavily on hard currency from oil exports, is in desperate need for cash to revive its shattered economy.

International firms are still waiting for an energy law to regulate how the oil wealth would be distributed, before they start pumping money into the country.

The law, which was endorsed by the cabinet in February, was expected to be passed by the parliament last month.

Iraq Prime Minister Nuri al-Maliki said he will hit with an ''iron fist'' all those who plans to harm the interests of the state and he said in a statement that he has ordered the security forces to face ''firmly all saboteurs''.

The power struggle in Basra, Iraq's second largest city, involves militias and politicians loyal to young Shi'ite cleric Moqtada al-Sadr, the Fadhila party and the Supreme Islamic Iraqi Council (SIIC).

Locally powerful Fadhila, which controls key oil industry jobs in Basra, opposes the creation of a Shi'ite ''super-region'' espoused by SIIC, the dominant Shi'ite faction in Iraq.

Hassan Jomaa, the head of General Union of Oil Employees in Basra, said if the government refuses to meet the workers demands then they will work on spreading the strike to all oil facilities in Basra, including exports and production.

But the oil ministry spokesman Jihad said it was not possible for the Oil Pipeline Company workers to stop exports because they have no influence in the Southern Oil Company which is in charge of exports.

REUTERS SYU VV1838