Iraq’s cabinet approves major oil sector projects, 31 DEC

 Iraq’s cabinet approves major oil sector projects

Shafaq News/ Iraq’s Prime Minister Mohammed Shia al-Sudani chaired the 53rd regular session of the Council of Ministers on Monday, approving several initiatives in the oil sector.

Basra-Haditha Oil Pipeline Project

The Council approved the recommendation of the Ministerial Energy Council to proceed with the construction of the Basra-Haditha oil pipeline, a 685-kilometer pipeline with a capacity of 2.25 million barrels. Key decisions included:

1. Contract Approval: A contract worth 5.97225 trillion dinars between Basra Oil Company and the Oil Projects Company, funded under the Iraq-China agreement.

2.Reduced Cost Procurement: Approval of a procurement order for the pipeline at 1.6205 trillion dinars, 5.5% below estimated costs. The pipeline will be constructed using high-quality materials and completed within 720 days.

3. Contract Exemptions: The project was exempted from Government Contract Execution Instructions (No. 2 of 2014) to facilitate streamlined execution.

Karbala Refinery Operations

The Council also addressed the operational file of the Karbala Refinery, approving the following measures:

1. Operational Contracting: The Midland Refineries Company was exempted from standard contracting regulations to engage Rowwad-Elqemma Company for refinery operations at $180 million annually, renewable for an additional year. This contract includes operational, laboratory, maintenance, and safety responsibilities, alongside training and local staff transfer, at a lower cost than the previous contractor.

2. Management Team Formation: A dedicated management team, led by the general director of the Midland Refineries Company, was formed to oversee refinery operations. This team was granted financial and contractual authority, with a spending cap of $15 million for operational needs.