Iraq - Part two:
Oil Export Pipelines/Terminals:
Much of Iraq's export capability was lost during the Iran-Iraq War, either to war-related damage or due to political reasons. In 1982, for instance, Syria (allied with Iran at the time) closed the 800 km / 500-mile, 650,000-bbl/d-capacity Banias pipeline, which had been a vital Iraqi access route to the Mediterranean Sea and European oil markets.
By 1983, Iraq's export capabilities were only 700,000 bbl/d, or less than 30 percent of operable field production capacity at that time. The respite prior to the Gulf War allowed Iraq to resume oil exports of about 2.8 MMBD (1.6 MMBD via the Kirkuk-Ceyhan pipeline, 800,000 bbl/d via the IPSA pipelines across Saudi Arabia, 300,000 bbl/d out of Iraq's Mina al-Bakr terminal, and around 100,000 bbl/d by truck through Turkey).
The 960 km / 600-mile, 40-inch Kirkuk-Ceyhan pipeline is Iraq's largest operable crude export pipeline. This Iraq-Turkey link consists has a fully-operational capacity of 1.1 MMBD, but can handle only around 900,000 bbl/d at present. A second, parallel, 46-inch line has an optimal capacity of 500,000 bbl/d and was designed to carry Basrah Regular exports, but is currently inoperable.
Combined, the two parallel lines have an optimal capacity of 1.6 MMBD. Expanding capacity to this level, however, will depend on Iraq's ability to rehabilitate the IT-1 and IT-1A pumping stations, as well as the Zakho metering station near the Iraq-Turkey border and other ongoing pipeline repairs on the 46-inch line.
This work appears to be several months behind schedule, and reportedly now is slated to be completed by September 2000. The 40-inch line has additional pumping stations and fewer bottlenecks than the 46-inch line, which allows for greater throughput than that of the larger line.
In the Gulf War, both pipelines were disabled when the crucial IT-2 pumping station, located about 93 miles south of the Turkish border, was destroyed. Currently, Iraq is bypassing IT-2, making it more difficult to reach the 1.6 MMBD dual-line capacity.
To make IT-2 operational, Iraqi officials have said that they need controls and associated valves costing around $50 million. The IT-1 pumping station near Kirkuk received lighter damage and is presently functional. The subsequent imposition of U.N. sanctions on Iraqi crude exports resulted in a complete closure of the Kirkuk-Ceyhan pipeline between 1991 and 1996.
On August 20, 1998, Iraq and Syria (which reopened their border in June 1997 -- after a 17-year closure -- for trade and official visits) signed a memorandum of understanding for the possible reopening of the Banias oil pipeline from Iraq's northern Kirkuk oil fields to Syria's Mediterranean port of Banias (and Tripoli, Lebanon).
In October 1999, Iraqi experts reportedly assessed the pipeline as capable of initial oil pumping capacity of 300,000 bbl/d (out of potential capacity of 1.4 MMBD). The Banias pipeline was closed by Syria in 1982 as a way to support Iran during the Iran-Iraq War. Iraq will need U.N. permission to export any oil via Syria.
Following the 1982 Banias line closure, Saudi Arabia agreed to allow Iraq to export 500,000 bbl/d of crude through the Saudi Petroline to the Red Sea. Then, between 1983 and 1988, two Iraqi pipelines across Saudi Arabia (IPSA-1 and IPSA-2) were built.
IPSA-2 included construction of a 1.65-million-bbl/d capacity line running parallel to the Petroline, an additional pumping station to boost IPSA-1's capacity to 1.65 MMBD, storage facilities, and a new Red Sea terminal. Iraqi crude began flowing through the IPSA lines in January 1990. Following Iraq's invasion of Kuwait in August 1990, Saudi Arabia closed the IPSA link, which now apparently has been emptied of oil and filled with water for maintenance.
In order to optimize export capabilities, Iraq constructed a reversible, 1.4-MMBD "Strategic Pipeline" in 1975. This pipeline consists of two parallel 700,000 bbl/d lines. The system allows for export of northern Kirkuk crude from the Persian Gulf and for southern Rumaila crudes to be shipped through Turkey.
During the Gulf War, the Strategic Pipeline was disabled after the K-3 pumping station at Haditha as well as four additional southern pumping stations were destroyed. According to Petroleum Intelligence Weekly (PIW), 7 tanks at K-3 were blown up in the Gulf War, leaving only two tanks with combined capacity of 300,000 barrels.
PIW also reports that Iraq has said that at least five tanks of 150,000 barrels each would be needed for proper batching. Under its post-sanction development plans, Iraq plans to add several new solar-powered pumping stations to boost the pipeline's overall capacity. Iraq also plans to expand the country's crude storage capabilities from 14 million barrels to 21-24 million barrels.
Most of this work will center on the Fao tank farm. Meanwhile, in late October 1999, Iraqi state-run newspaper Babil reported that the country's Oil Ministry had established a new company to handle Iraq's pipeline network, and pumping stations.
In the Persian Gulf, Iraq has three tanker terminals: at Mina al-Bakr, Khor al-Amaya, and Khor al-Zubair. Iraq also has additional dry goods ports at Basrah and at Umm Qasr, which is being outfitted to accommodate crude tankers. Mina al-Bakr is Iraq's largest oil terminal, with four 400,000-bbl/d capacity berths capable of handling very large crude carriers (VLCCs).
Gulf War damage to Mina al-Bakr appears to have been repaired in large part and the terminal currently handles 1.3-1.4 MMBD. A full return to Mina al-Bakr's nameplate capacity apparently would require extensive infrastructure repairs. Mina al-Bakr also is constrained by a shortage of separation and storage facilities, most of which were destroyed in the Gulf War.
For years, navigation into Mina al-Bakr was impaired by mines and by Iraqi Oil Tankers Company's 155,000-Dwt (dead-weight tons) Ameriyah tanker, sunk during the Gulf War. Mina al-Bakr is capable of servicing smaller tankers, including a well-publicized trial loading by the 36,900-Dwt Kirkuk tanker in August 1996.
While three channels allowing for unrestricted passage and safe navigation reportedly have been cleared, it is unknown whether Mina al-Bakr's underwater protection system can safely accommodate large volumes of VLCC traffic.
Iraq's Khor al-Amaya terminal was virtually destroyed in the Iran-Iraq War. Repairs were begun in 1993, and Iraq stated in 1995 that the terminal could load 600,000 bbl/d. Upon full completion of repairs, Iraq projects Khor al-Amaya's capacity will rise to 1.2 MMBD.
Iraq's third terminal, Khor al-Zubair, is linked to the Umm Qasr port by a 30-mile long canal. While Khor al-Zubair generally handles dry goods, it has the capability to service small quantities of liquefied petroleum gas (LPG) and refined products. Like Umm Qasr, Khor al-Zubair is being outfitted with crude loading capabilities.
Iraq's current refining capacity is believed to be around 350,000 bbl/d (although the Iraqis claim 700,000 bbl/d), compared to a pre-Gulf War, nameplate capacity of 700,000 bbl/d. Iraq has 10 refineries and topping units. The largest are the 150,000-bbl/d Baiji North, 140,000-bbl/d Baiji Salaheddin, 126,000-bbl/d Basrah, and 100,000-bbl/d Daura plants.
During the Gulf War, both of the Baiji plants in northern Iraq as well as the refineries at Basrah, Daura, and Nasiriyah were severely damaged. This cut Iraq's refining capacity to around 60,000 bbl/d in March 1991. While much of Iraq's refinery capacity appears to have been restored by 1993, several of the smaller refineries, namely the 27,000-bbl/d Kirkuk and the 27,000-bbl/d Nasiriyah plants, were cannibalized for parts to repair damage at Baiji, Basrah, and Daura, which was expanded in 1994.
In addition, even though total capacity now approaches pre-1991 levels, refining depth has been severely reduced, and due to rising demand, Iraq has been forced to utilize some of its stocks. A lack of light-end products, low quality gasoline, and rising pollution levels because of a lack of water treatment facilities are some problems now faced by Iraq's downstream sector. Post-sanction plans include attracting foreign investment to perform refinery upgrades and building a new $1-billion, 290,000-bbl/d "Central" refinery near Babylon.
In late October 1999, Iraq's Oil Ministry stated that oil product consumption in Iraq had fallen by at least 15 percent since prices were raised by up to 50 percent in September. The September price increase reportedly was initiated by the government to help curtail smuggling, as well as to reduce "irrational use" by consumers. Iraq reportedly has raised gasoline prices twice in 1999 as part of an effort to curb smuggling, although to what effect is unclear, since prices at the pump remain heavily subsidized (only pennies per gallon). Meanwhile, a crackdown on smuggling began in June 1999, with violators facing up to 10 years in prison.
Source: United States Energy Information Administration
© 2000 Mena Report (www.menareport.com)
- Iraq: 350 need treatment after blast of trucks filled with toxic chlorine gas
- US$5 million to be invested in Iraq disability diagnosis center
- Tetra Tech receives $65 million work order in Iraq
- 'Kurdistan is part of Iraq': Ahlam gets political with Kurdish contestant
- Iran’s Customs Officials Destroy 14 Tons of Smuggled Iraqi Milk