Saboteurs launching attacks on Iraq's oil and electricity infrastructure appear to be employees working in the industry or others acting on inside information, reconstruction officials said Sunday.

A Western diplomat in Baghdad said the "precise" targeting of especially vulnerable or valuable portions of the oil and electricity systems -- and even a sewage treatment plant -- has increased the damage to critical infrastructure beyond what would be expected from random attacks.

The diperators that provide domestic electricity.

Allawi (search) said saboteurs have attacked vital oil pipelines 130 times in the last seven months, causing hundreds of millions of dollars in damage and lost revenues, hindering Iraq's efforts to rebuild and adding to the hardships of average Iraqis.

The Western diplomat said insurgents were suspected of using blackmail and threats to coerce Iraqi workers to launch attacks or to provide information on vulnerable locations in the country's oil pipelines and electric power lines.

Funding and information for the sabotage also may be flowing into Iraq from other countries, the diplomat said.

Oil Minister Thamer al-Ghadban told Dow Jones Newswires on Sunday that his ministry would extend for "a few months" a contract with South African security contractor Erinys International that was set to expire in less than a month.

Al-Ghadban said he would also expand the 14,000-member Iraqi force created to protect the infrastructure.

Steve Wright, a spokesman for the U.S. Army Corps of Engineers (search), said sabotage of key infrastructure appears to have been planned before the U.S.-led invasion last year by members of Saddam Hussein's (search) government. In some cases, Iraqi oil wells were wired to be set on fire.

In the months after the invasion, saboteurs -- suspected of being insiders -- set fire to a computerized control room for a liquid propane gas plant as well as the plant's warehouse, damaging millions of dollars in equipment, he said. Elsewhere, a water treatment plant used in Iraq's oil industry was sabotaged, Wright said.

Even a repaired sewage treatment plant was sabotaged -- probably by insiders, the Western diplomat said.

Now, Iraqis hired by the Army Corps of Engineers to work in Iraq's oil and electric infrastructure have to go through background checks overseen by the new U.S. Embassy, Wright said.

Arab tribal leaders living near pipeline routes are also being hired to protect the lines, he said.

Attacks in northern Iraq have hamstrung exports from the country's oil pipeline to Ceyhan, Turkey, with the line opening only intermittently before saboteurs' bombs sever it again. That northern pipeline, which accounts for only a small fraction of oil exports, has been closed since it was severed by a blast a month ago.

Three major attacks also temporarily halted exports from southern Iraq, which handles 90 percent of Iraq's oil exports.

Guerrilla fighters also have targeted foreign experts the coalition has contracted to help carry out technical repairs and bring in badly needed spare parts.

And last month, insurgents ambushed and killed the security chief for Iraq's Northern Oil Company, Ghazi Talabani. Police officials said five men arrested in connection with the assassination belonged to Ansar al-Islam, a Kurdish group believed linked to al-Qaida.