Iraqi Oil Minister Bassim Mohammed Khudair said his country is negotiating with an alliance of U.S. and Qatari companies over the proposed Basra–Baniyas oil pipeline project, as part of efforts to establish new outlets for exporting crude to global markets. He made the announcement on the sidelines of the opening of the fourth edition of the Oil and Gas Exhibition and Conference in Baghdad.
Export routes through Ceyhan and Baniyas
Khudair said Iraq is working with Chevron, Qatar’s USS and IT Capital to build a new pipeline network designed to export crude through Turkey’s Ceyhan port and Syria’s Baniyas, helping diversify export outlets.
Prime Minister Ali al-Zeidi said last Saturday that he had ordered the acceleration of the Basra–Haditha–Fishkhabur oil pipeline project and the Haditha–Baniyas pipeline, during a joint meeting attended by the oil minister, the director of the prime minister’s office and representatives of several companies implementing the project.
Exports at 3 million barrels per day
The oil minister reaffirmed Iraq’s commitment to its production quota within OPEC, saying the country’s output would not exceed 4.2 million barrels per day. He added that average oil exports this month had reached 3 million barrels per day, with tankers continuing to load additional volumes.
Khudair said Iraq would soon announce opportunities to develop and build oil refineries and invite companies and investors to compete for them, without specifying a timetable for the announcement or implementation.
Request to raise the baseline under OPEC+
Informed sources said on Wednesday that Iraq wants to increase its oil-production quota as the OPEC+ alliance reviews member countries’ capacities to determine the volumes they can produce next year. Iraq is seeking to have its target output calculated from a baseline of 6 million barrels per day.
The OPEC+ alliance comprises OPEC members and non-OPEC allies, led by Russia. Before the outbreak of the Iran war on February 28, Iraq was producing about 4 million barrels of oil per day, most of it from Basra in the country’s south.
Heavy reliance on oil revenues
Iran’s closure of the Strait of Hormuz, through which about 20% of the world’s energy supplies had passed before the war, forced Iraq to cut production and resort to exporting limited volumes through Syria by tanker trucks and through Turkey via a pipeline extending to the port of Ceyhan.
Oil sales provide about 90% of Iraq’s revenues, while the country relies on the foreign currency they generate to finance imports, support the stability of the dinar, and pay the salaries of government and public-sector employees and pensioners. These groups account for about 20% of the population, which exceeds 46 million.
