The Iraqi army has seized control of the deep-sea port of Umm Qasr from Shia insurgents, paving the way for the $500m privatisation of the site.

Umm Qasr’s north and south ports are now under Iraqi government control. As MEED went to press, arrests were being made of the final members of Shia insurgent group Jaysh al-Mahdi (Jam), which had infiltrated operations at the north port.

Control of Umm Qasr has now been passed from the army to the Iraqi navy.

Sources close to the Baghdad government are reluctant to discuss details of the army’s strategy in the area but say ‘several hundred’ troops remain deployed in Umm Qasr to maintain security.

The Iraqi army was able to seize the port without casualties or a shot being fired, the sources say, moving in when Jam loyalists left Umm Qasr to join the battle against government forces in the nearby city of Basra. That battle was led by the Mahdi Army, run by the radical Shia cleric Moqtada al-Sadr.

The military campaign against the Mahdi Army in Iraq’s second city has been widely seen as an embarrassment for the army, with 1,300 soldiers and police officers dismissed for refusing to join the offensive against the Shia militias.

However, Baghdad has been quick to capitalise on the success in Umm Qasr.

Since the port was retaken, an economic committee in the capital has approved plans for a long-term concession to privatise the southern port for an estimated $500m. At the same time, an international port operator will be sought to overhaul and manage the north port.

International port operators were attracted by the potential of the southern port, but although Baghdad received several unsolicited expressions of interest, it was unable to begin a coherent bidding process while Jam remained in control of the north port.

Jam had been siphoning off revenues from the port to finance the activities of local militias.

Its wide-ranging influence at the port’s customs, immigration and cargo handling points has meant that only a fraction of revenues from Umm Qasr were passing to central or local governments (MEED 29:2:08).

“The privatisation process can now move ahead,” says a US official in Baghdad. “Hopefully within weeks we will issue requests for proposals from management companies to run the north port, and ask for expressions of interest from operators to run the south port.”

The process of removing Jam from the port is continuing, with staff being screened.

“Employees at the site are being vetted, which has briefly slowed operations, but things should be running smoothly soon,” says the US official. “There is no evidence that Jam has made any attempt to get back into the port again.”

The recent military operations in the south of the country have been a critical test of the Iraqi government’s ability to enforce the rule of law, after Basra province was passed to local control by the UK in December 2007.