An image from a jihadist website shows militants of the Islamic State of Iraq and the Levant posing with their standard at a captured checkpoint in Iraq's Salahuddin province.

An image from a jihadist website shows militants of the Islamic State of Iraq and the Levant posing with their standard at a captured checkpoint in Iraq's Salahuddin province. Photo: AFP

Islamist militants in Iraq have occupied Saddam Hussein's former chemical weapons production facility, which contains a stockpile of old chemical weapon, the US government has said.

US military officials don't believe the militants from the Islamic State in Iraq and the Levant, also known as ISIS,  would be able to create a new weapon from the stockpiles left behind at the Muthanna complex about 60 kilometres north-west of Baghdad, according to the Wall Street JournalNonetheless, the rapid loss of control of the key site in Iraq has unsettled US authorities after weeks of rapid gains by the Sunni militants.

"We remain concerned about the seizure of any military site by the ISIL," US State Department spokeswoman Jen Psaki said, according to the media outlet. "We do not believe that the complex contains CW materials of military value and it would be very difficult, if not impossible, to safely move the materials."

Chemical warfare agent filled aerial bombs await destruction at Muthanna complex Iraq in an undated file photo.

Chemical warfare agent filled aerial bombs await destruction at Muthanna complex Iraq in an undated file photo. Photo: Reuters

However, one US official said that had they known Iraq would become so destabilised after the 2011 pullout of US troop, they would not have left the stockpiles in place. ISIL, an offshoot of al-Qaeda-linked fighters in Syria, has rapidly swept through large parts of Iraq in recent weeks, undermining security in the country.

The claim that former Iraqi leader Saddam Hussein possessed weapons of mass destruction and posed a threat to world security was the basis for the 2003 US invasion of Iraq. Before the invastion, the weapons at Muthanna had been found by UN inspectors but were dismantled with chemical stocks militarily useless and closed off in bunkers.

The US stressed the takeover of the site did not comprise a major military gain.

"The entire Al Muthanna mega-facility was the bastion of Iraqi's chemical weapons development program," the Central Intelligence Agency said in a 2004 report on Iraqi weapons of mass destruction.

"During its peak in the late 1980s to early 1990s, it amassed mega-bunkers full of chemical munitions, and provided Iraq with a force multiplier sufficient to counteract Iran's superior military numbers. " 

The United Nations Special Commission, a body created in the aftermath of the Gulf War, identified and destroyed most of Iraq's chemical weapons from 1991 to 1997.

"Two wars, sanctions and UNSCOM [United Nations Special Commission] oversight reduced Iraq's premier production facility to a stockpile of old damaged and contaminated chemical munitions (sealed in bunkers), a wasteland full of destroyed chemical munitions, razed structures, and unusable war-ravaged facilities," the CIA report said.

Nonetheless, the issue of chemical weapons and weapons of mass destruction remains a sensitive one because of the role of the WMDs in the justification for the 2003 US invasion of Iraq.