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‘US builds hospitals in Georgia, readies for war with Iran’

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The United States is sponsoring the construction of facilities in Georgia on the threshold of a military conflict in Iran, a member of Georgian opposition movement Public Assembly, Elizbar Javelidze has stated.

According to the academician, that explains why President Mikhail Saakashvili is roaming the republic opening new hospitals in its regions.

“These are 20-bed hospitals…It’s an American project. A big war between the US and Iran is beginning in the Persian Gulf. $5 billion was allocated for the construction of these 20-bed military hospitals,” Javelidze said in an interview with Georgian paper Kviris Kronika (News of the Week), as cited by Newsgeorgia website.

The opposition member stated that the construction is mainly paid from the American pocket.

In addition, airports are being briskly built in Georgia and there are talks of constructing a port for underwater vessels in Kulevi on the eastern Black Sea coast in Georgia.

Javelidze believes that it is all linked to the deployment of US military bases on the Georgian soil. Lazika – one of Saakashvili’s mega-projects, a new city that will be built from a scratch – will be “an American military town”. According to the politician, “a secret airdrome” has already been erected in the town of Marneuli, southern Georgia.

The opposition member wondered who would protect Georgia in case if Iran fires its missiles against US military facilities on the territory of the Caucasian state.

All in all, about 30 new hospitals and medical centers were opened in the former Soviet republic in December last year. The plan is to build over a hundred more.

As for Lazika, the Georgian president announced his ambitious idea to build a second-largest city in Georgia, its western economic and trade center, at the end of 2011. According to the plan – which was slammed by his opponents and many analysts – Saakashvili’s dream-town will become home to at least half a million people within a decade.)

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US, Israel to “challenge” Iran

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Garibov Konstantin

The United States and Israel are due to hold the Austere Challenge-12 military exercise in the Middle East to train troops in interacting in antimissile and antiaircraft defences, and also to boost coordination of action by Israeli and US Army servicemen.

The war games will prove the largest-scale ones in the two countries’ military cooperation history. Thousands of US and Israeli Army servicemen, dozens of ships and deck-based aircraft are due to take part.

The two countries held the war games of similar scale three years ago. In autumn 2009, more than a thousand US Army servicemen helped the Israelis to service antiaircraft batteries, and drilled joint action of the two countries’ troops to deal with a likely military conflict in the region. Tehran took the war games as an unprecedented pressure that was brought to bear on the Islamic Republic.

The Pentagon now claims that the military exercise was planned long ago and should by no means be seen as a response to Iran’s Wilayat-90 military exercise, which drew to a close in the Strait of Hormuz on January 4th . But according to reports late last month, the US-Israeli military exercise was originally due in spring this year. Experts claim that it is Tehran’s successful testing of two Iran-made Gader anti-ship cruise missiles that prompted the US and Israel to reconsider the time of their military exercise and hold it at an early date. Gader missiles are capable of hitting targets at a distance of 200 kilometres. Besides, the Pentagon Chief Leon Panetta pledged to go to any lengths to prevent Iran from developing nuclear weapons.

Adding fuel to the fire in the region, as it were, is the raging political crisis in Syria, as well as Iran’s recent threat to block the Strait of Hormuz, which is unacceptable to the United States. In the event of a US-Israeli military conflict with Iran, fighting may spread to the entire region, an expert with the Russian Academy of Sciences’ Institute for Oriental Studies Liudmila Koulagina says, and elaborates.

“The Middle East nations, Liudmila Koulagina says, are clearly opposed to any fighting in the region on the understanding that even an airstrike on Iran will inevitably provoke Iran’s retaliatory strikes on a number of neighbouring countries. Fighting would inevitably sweep the entire region. Now, this is the worst-case scenario for the Middle East, since it is a major oil region and a home to US closest allies, such as Saudi Arabia. Any fighting in the Middle East would prove a great error.”

Meanwhile Tehran has said that it will soon hold yet another military exercise, namely one in the Strait of Hormuz and the Persian Gulf in February. The exercise will be titled the way it has been in the past seven years, Great Prophet, but the Iranian military warns there’ll be some changes made, without bothering to specify. Now, if Austere Challenge-12 happens to coincide with Great Prophet, which is not at all impossible, the Middle East will for the first time ever become the scene of two biggest simultaneous war games.

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Iran plans more war games in strait as sanctions bite

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By Robin Pomeroy
TEHRAN | Fri Jan 6, 2012 8:03am EST

(Reuters) – Iran announced plans on Friday for new military exercises in the world’s most important oil shipping lane, the latest in weeks of bellicose gestures towards the West as new sanctions threaten Tehran’s oil exports.

Real Admiral Ali Fadavi, naval commander of the Revolutionary Guards Corps, said exercises next month would focus directly on the Strait of Hormuz, which leads out of the Gulf and provides the outlet for most Mid-East oil.

Iran held a 10-day drill which ended on Monday in neighboring seas.

“Today the Islamic Republic of Iran has full domination over the region and controls all movements within it,” Fadavi said in remarks reported by the Fars news agency.

Iranian officials have threatened in recent weeks to block the strait if new sanctions harm Tehran’s oil exports, and this week said they would take action if the United States sails an aircraft carrier through it.

The United States, which has a massive naval fleet in the area that is overwhelmingly more powerful than Iran’s sea forces, says it will ensure the international waters of the strait stay open. Britain said on Thursday that any attempt to close it would be illegal and unsuccessful.

New financial sanctions signed into law by U.S. President Barack Obama on New Year’s Eve are aimed at making it difficult for most countries to buy Iranian oil. The European Union is expected to announce tough measures of its own at the end of the month.

Most traders believe Iran will still be able to find buyers, at least in the short term, for its exports of 2.6 million barrels of oil per day (bpd). But it may have to offer steep discounts that reduce the hard currency revenue it needs to feed its 74 million people.

The sanctions are already having an effect on Iran’s streets, where prices have been rising and the rial currency is falling. Iranians have been queuing up at banks to convert their savings into dollars.

The economic hardship comes less than two months before a parliamentary election, Iran’s first since a 2009 presidential election that led to mass street protests across the country.

Iran’s rulers successfully put down those demonstrations two years ago with force, but since then the Arab Spring has shown the vulnerability of authoritarian governments in the region to public protest fueled by anger over economic hardship.

NUCLEAR PROGRAMME

Washington and its allies are imposing the measures to force Iran to abandon a nuclear program which they say is aimed at producing an atomic bomb. Iran says the program is peaceful.

European Union officials say the EU, which collectively buys about 500,000 bpd of Iranian oil, rivaling China as the largest market, has agreed to impose an embargo halting all imports.

EU diplomats said they are discussing how long they will give member countries to halt purchases, with France, Germany and others wanting the ban imposed within three months but Greece favoring a grace period of up to a year.

China has also cut its imports by more than half in January and February while haggling with Tehran over the size of the discount it wants in return for doing business with it.

Other big buyers, including Turkey and Japan, say they are seeking a waiver from the U.S. sanctions.

The new American law allows Obama to give temporary waivers to allies to continue to buy Iranian oil to prevent a price shock, but to receive the permits, countries are meant to show they are reducing trade with Iran.

Iran has put on a brave face over the sanctions. Foreign Minister Ali Akbar Salehi said on Thursday the country would “weather the storm.”

“Iran, with divine assistance, has always been ready to counter such hostile actions and we are not concerned at all about the sanctions,” he told a news conference.

But in a sign it is seeking to alleviate the pressure, Salehi said Tehran was interested in resuming negotiations over its nuclear program with Western powers.

Turkey’s visiting foreign minister brought an offer from Catherine Ashton, the EU foreign policy chief who negotiates on behalf of major powers.

Talks over Iran’s nuclear program collapsed a year ago. Iran has repeatedly offered to restart the talks since then, but has insisted it will not negotiate over its right to continue enriching uranium.

Western countries say talks are pointless unless a halt to enrichment is on the table. Enriched uranium can be used to fuel a reactor or build a bomb.

OIL PRICES IN SPOTLIGHT

After years of sanctions that had little impact, Western countries have adopted a far more direct approach in recent months, with sanctions that explicitly impact the oil industry that provides 60 percent of Iran’s economy.

The new U.S. measures would cut off any institution that deals with the Iranian central bank from the U.S. financial system. If implemented fully, it would make it impossible for most countries’ refineries to buy Iranian crude.

But Washington has to balance its determination to isolate Tehran with concern that driving its oil off markets will raise prices and hurt the fragile global economy. Brent crude futures hovered above $113 a barrel on Friday, up nearly $7 since Obama signed the new sanctions law.

To ease the impact on markets, the new U.S. measures take effect over several months, and the leeway given to Obama to offer waivers allows countries time to find other suppliers. Saudi Arabia, the world’s biggest oil exporter and a foe of Iran, says it will make up for any supply shortfall.

Traders and analysts believe it is unlikely Iran will actually carry out its threats to block the strait.

“We’ve seen this movie before,” said Cliff Kupchan, an Iran analyst at the Eurasia Group. “Neither side wants a war. A lot of this rhetoric is overstated.”

Even if it tried, Iran could not blockade the strait for long in a direct challenge to a U.S. fleet led by the giant supercarrier John C. Stennis, accompanied by a guided-missile cruiser and flotillas of destroyers and submarines.

The Combined Maritime Force protecting Gulf shipping also includes other countries such Britain, France, Canada, Australia and the Gulf Arab states, under the command of a U.S. admiral.

Still, Iran has many ways it could provoke a Western response, from missiles within range of U.S. targets in the region, to small boats that could attack a ship near shore, to allied militia in Palestine and Lebanon that can strike Israel.

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Oil surges on speculation of supply disruption, U.S. stimulus

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Oil surged above $100 a barrel on speculation supplies will be disrupted after a report that Iran will hold drills to close the Strait of Hormuz and that the Federal Reserve may announce additional stimulus measures.

Crude advanced as much as 3.6 percent after the state-run Fars news agency reported the military maneuvers will be “soon,” citing Parvis Sorouri, a member of the parliament’s national security and foreign policy committee. The Strait of Hormuz is a bottleneck for oil exports from the Persian Gulf. The Fed is scheduled to release a statement on monitory policy later today.

“There have been a number of rumors floating around the market today,” said Tom Bentz, a director with BNP Paribas Prime Brokerage Inc. in New York. “I saw the Iran story yesterday but those headlines seem to have got traction this morning. There are also rumors for further action by the Fed, but where they come from I don’t know. In this electronic world things can jump quickly and trigger stops.”

Crude for January delivery gained $1.91, or 2 percent, to $99.68 a barrel at 11:07 a.m. on the New York Mercantile Exchange. Earlier, futures touched $101.25 a barrel. Prices have risen 9.1 percent this year.

Brent oil for January settlement increased $2.07, or 1.9 percent, to $109.33 a barrel on the London-based ICE Futures Europe exchange.

“There are no headlines to explain this move,” said Stephen Schork, president of Schork Group Inc. in Villanova, Pennsylvania. “One has to look at the usual suspects. It was probably a fat-fingered mistake or a margin call.”

Iran Statement

Crude pared gains after an Iranian Foreign Ministry spokesman said the Strait of Hormuz isn’t closed. The comments on the strait were made by people who don’t have an official title, said Ramin Mehmanparast, the spokesman.

Sorouri, in comments that first appeared yesterday on the website of the state-run Iranian Students News Agency, said “if the world wants to make the region insecure, we will make the world insecure.”

About 15.5 million barrels of oil a day, about a sixth of global consumption, flows through the Strait of Hormuz between Iran and Oman, according to the U.S. Department of Energy.

“This is the kind of story that sends a shock wave through the market,” said Richard Ilczyszyn, chief market strategist and founder of Iitrader.com in Chicago.

The market also rose on speculation that the Fed will announce a third round of bond purchases in a tactic that has been dubbed quantitative easing. The Fed bought a total of $2.3 trillion in bonds in two rounds of quantitative easing from December 2008 until June 2011.

Fed Chairman Ben S. Bernanke and his policy-making colleagues plan to meet today to discuss the outlook for an economy that has strengthened since their November meeting, lowering the jobless rate to 8.6 percent from 9.1 percent.

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Italy’s Saipem Inks Multiple Offshore Contracts Worth USD 1.5 Billion

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In Iraq, Saipem has been awarded by South Oil Company the EPIC contract for the Iraq Crude Oil Export Expansion Project – Phase 2, within the framework of the expansion of the Basra Oil Terminal, off the Al Faw Peninsula in the Arabian Gulf, approximately 550 kilometres south-east of Baghdad.

The contract encompasses the engineering, procurement, fabrication and installation of a Central Metering and Manifold Platform (CMMP), to be installed in a water depth of 28 metres, along with associated facilities.

Fabrication of the CMMP topsides will be carried out at Saipem’s yard in Karimun (Indonesia), while the jacket and piles will be fabricated at the Saipem Taqa Al-Rushid (STAR) yard in Dammam (Saudi Arabia). Offshore activities will be performed in the third and fourth quarter of 2013.

In Nigeria, Saipem has been awarded the OFON2 – D030 contract by Total E&P Nigeria Limited, for new offshore facilities in the Ofon field, about 50 kilometres off the southern coast of Nigeria.

Saipem will carry out the engineering, procurement, fabrication and installation of the OFP2 Jacket (comprising the 1,970 ton jacket structures and the 4,500 ton piles), as well as the transportation and installation of the complete new OFQ living quarter offshore platform.

The fabrication of the jacket will take place in the Saipem Rumuolumeni Yard in Port Harcourt, Nigeria.

Offshore activities will be performed mainly by Saipem 3000 vessel, in different phases during 2013.

Furthermore, Saipem has been awarded contracts in the Norwegian and British sectors of the North Sea and in the Gulf of Mexico, mainly based on deployment of the Saipem 7000 vessel, for the transportation and installation of platforms and marine facilities, along with the decommissioning of existing offshore structures.

Offshore activities will be performed in several phases commencing in the fourth quarter of 2011 through to late 2014.

Finally, Saipem has agreed to increase the scopes of its work on a number of existing E&C Offshore contracts.

Saipem is organised into two Business Units: Engineering & Construction and Drilling, with a strong bias towards oil & gas related activities in remote areas and deepwater. Saipem is a leader in the provision of engineering, procurement, project management and construction services with distinctive capabilities in the design and execution of large-scale offshore and onshore projects, and technological competences such as gas monetisation and heavy oil exploitation.

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