IRAQ IS PREPARING TO ESTABLISH A PROJECT THAT WILL CHANGE THE OIL MAP.. WILL IT AFFECT ENERGY PRODUCERS?
Iraq’s budget for the current year 2024 allocated an amount of up to 4.9 billion dollars to establish a pipeline extending from Basra in the far south of Iraq on the waters of the Gulf, to the city of Haditha, located in the far west of Iraq within the Anbar Governorate bordering Jordan and Syria, which means the return of life to the Iraq project – Jordan, which has been witnessing political opposition inside Baghdad for years, stipulates that Iraqi oil be exported through Jordan to the world via the Mediterranean, given that the project was essentially linked to extending the oil pipeline through two stages, the first to Haditha, which is the longest, and the second to enter neighboring Jordanian territory.
For years, the project has witnessed controversy regarding its economic feasibility, in addition to the opposition of political and armed forces and parties allied with Tehran, describing the project as allowing Iraqi oil to reach the Israeli occupation. However, the proposals presented by economists and oil experts confirm that opening a third export outlet to Iraq will change the waters of the Arabian Gulf and Turkey. It will give Iraq an advantage over Iran and Saudi Arabia in terms of export diversification, especially in times of military and political tensions in the Middle East.
Advisor to the Iraqi Ministry of Oil, Ahmed Al-Omar, said that the arrival of the pipeline to Haditha, western Iraq, means that Iraq can transport its oil not only through Jordanian territory and then Aqaba, but also through the Syrian port of Baniyas.
Al-Omar added, “The project will change the map of the oil industry and production in the region and give Iraq a great advantage over other oil neighbors.” By approving the amount allocated to start the project, according to the age, the government will begin work on the implementation phase, stressing that Iraqi companies will undertake work on it, and the pipeline will be implemented through the Iraqi Ministry of Industry as well.
STRATEGIC PROJECT
Director General of the Petroleum Projects Company, Ali Ward Hammoud, said, “The Basra-Haditha oil pipeline project is considered one of the most important strategic projects for the movement of oil in Iraq, and it strengthens the economy by enabling the country to export oil through new ports.”
He added, “The oil produced from the southern fields is exported through our ports and loading points overlooking the Gulf, which is the only outlet for most of Iraqi oil currently, and with the presence of geopolitical challenges in the region, the Ministry of Oil has taken it upon itself to diversify export outlets, as over the past decade it prepared a study.” “For the northern export system, with the help of the most important international consulting companies, and developing appropriate plans to develop new export outlets to serve the expansion of oil production in the country through the licensing rounds proposed by the ministry.”
He continued, “The Basra-Haditha pipeline falls within this trend. The size of the pipeline is 56 knots, and has a capacity to secure the export of two million and 250 thousand barrels per day. It will be manufactured by Iraqi hands, and the bulk of it will be manufactured by the Iron and Steel Company affiliated with the Ministry of Industry, and it provides new export outlets.” Iraqi oil is transported to European and North American countries, in line with the development road project and the government’s endeavor to make it a global energy corridor, in addition to its role in transporting goods between the East and the West.”
He confirmed that “there is an intention to connect the pipeline in the future to the port of Tartous on the Mediterranean Sea, after achieving appropriate security conditions in Syria, through a pipeline established for this purpose and linking the Haditha warehouse to the port of Tartous,” he said.
IRAQ TOWARDS NEW MARKETS
According to Iraqi political sources, the beginning of the project was in 1983, when the Iraqi and Jordanian sides agreed to extend a pipeline from Basra to the port of Aqaba on the Red Sea, passing through Jordanian territory. At the time, both sides demanded guarantees from the United States so that Israel would not target the pipeline.
The sources state that the government of Muhammad Shiaa al-Sudani seeks to start the project as soon as possible, because the pipeline represents a new type of outlet for Iraqi energy exports, specifically oil, and it also provides the opportunity for Iraqi oil to reach new markets in Europe, as well as sustainable and diversified economic gains and financial returns. In addition to participating and investing in international manufacturing sectors.
Although Iraq’s financial budget for the current year included the new pipeline project at an amount estimated at approximately 6.5 billion Iraqi dinars ($4.9 billion dollars),representatives from Basra Governorate confirmed that they would obstruct the project.
Member of the Iraqi Parliament, Hadi Al-Salami, stated, “What is strange about this project is that it was rejected by most of the Iraqi parties during the period of Mustafa Al-Kadhimi’s (previous) government, but the parties themselves currently agree to it,and we do not know what the reasons are, especially since information is scarce about it, and we do not know “The reasons for the government’s secrecy about it.”
(Mnt Goat – Why this change of heart about the project? Like a said before a “spigot” is now opened and it’s pouring now. That’s the difference. The global entities have now said that now is the time for Iraq to move ahead aggressively. This, as we can now see, is making all the difference in seeing more and more progress. Yes, it’s kind of spooky too in a way to see how there is secret hidden power structures that can influence things so quickly when they want to.)
Al-Salami explains, “Politicians and representatives in Iraq do not have sufficient information about the pipeline project, and we demand to know the economic feasibility of the project from the government’s point of view.”
The consultant in international transport economics, Ziad Al-Hashemi, pointed out that “the Basra-Aqaba pipeline project is a strategic project to raise the level of cooperation between Iraq, Jordan and Egypt, and to enhance the level of inter-relations, whether political, security or economic, and that the passage of the oil pipeline through a regional country like Jordan will not be exploited.” This pipeline is intended to put pressure on Iraq in the future, and this will ensure the smooth flow of Iraqi oil flows without obstacles.”
Al-Hashemi continues by saying, “The project raises fears that the pipeline will be exploited to supply the Israeli entity with Iraqi oil in response to supposed Western requirements or pressures.”
Al-Hashimi added, “One of the problems that the project may face is the refusal by some pivotal regional countries to hinder Iraq’s attempts to diversify Iraqi oil export outlets towards the West, in addition to the security pressures and stability problems that still constitute an obstacle to the completion and success of any Iraqi project, let alone About the possibilities of opening new outlets for corruption inside and outside Iraq due to the high construction costs.
In turn, oil expert Kovind Sherwani considered that “the Basra-Haditha oil pipeline project falls within the framework of the first phase of a project extending to the port of Aqaba in the Mediterranean, which will provide a new export outlet for Iraq.”
He continued, “We also believe that it is necessary to revive the Kirkuk-Ceyhan line, which used to transport up to 400,000 barrels per day, in addition to the investment possibility in transporting Nineveh and Salah al-Din oil, with a capacity that could reach one million barrels per day, which provides export outlets.” A mission for Iraq.”
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