updated 8/29/2006 1:12:09 PM ET 2006-08-29T17:12:09

While acknowledging an uptick in violence in the past few days, one of Iraq’s deputy prime ministers said Tuesday that attacks overall are declining.

Barham Salih also predicted that by the end of the year, half of the country’s provinces will be controlled by Iraq’s security forces.

Salih said violence had dropped by half during the past month, but that terrorists and remnants of the deposed government of Saddam Hussein remain a challenge to the government.

U.S. support will continue to be important even after Iraqi security asserts itself, he said.

“We are building a system that can fight off terrorism more effectively,” Salih told reporters at the State Department during a video news conference from Baghdad.

According to the Pentagon, Iraqi security controls one province, Muthana, which was turned over in July.

Salih seemed less optimistic than Iraqi President Jalal Talabani, who said at a news conference in Baghdad earlier this month that Iraqi forces would take over security of the country’s 18 provinces by the end of the year.

Salih said Iraq would accelerate revival of its oil industry, which is second only to Saudi Arabia in petroleum reserves, even though facilities could become terrorist targets.

There is a risk of violence, he said, “but that should not be an inhibiting factor.”

Reporting on preparations for Iraq’s 2007 budget, Salih said agreement had been reached that oil revenues would be controlled by the central government and then shared by the country’s regions.

The deputy prime minister said Iraq is projecting 1.7 billion to 1.8 billion barrels a day for export, and production of 2.2 billion to 2.5 billion barrels overall.

Production is expected to double to 4.3 billion barrels by 2010, he said.

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