MEES learns from authoritative sources that Iraq and Syria have agreed to reopen the crude oil pipeline between the two countries - which has been closed since 1982 - in November, probably around the middle of the month.
It is understood that Baghdad will export around 200,000 b/d of Basrah Light crude to Syria.
The Iraqi crude, to be pro-vided at a discount off international prices, will be used in domestic Syrian refineries, allowing Damascus to export an equivalent amount of Syrian Light and Suwaidiya cruds to international markets. An agreement between the two countries to reopen the pipeline was first signed on 14 July 1998 (MEES, 20 July 1998).
MEES also learns that Iraqi technicians have finished repairing one of the 32-inch pipelines in the system in both countries and that it was originally planned to start the pumping at an earlier date.
However, because of technical problems related to leaks at high pressures during testing, it has now been decided to carry out further tests and re-pairs before starting commercial operation.
Syria's decision to import Iraqi crude oil - and in the past few months it has already started receiving fuel oil - outside the UN sponsored oil-for-food program follows the example of its neighbors Jordan and Turkey.
In the past decade, Jordan has imported first 75,000 b/d of crude and products and more recently some 96,000 b/d of oil at preferential prices (MEES, 31 January).
The Jordanians have notified the Security Council of the transaction but have never re-ceived official approval from the Sanctions Committee. For its part, Turkey has also been importing both crude and products to the tune of around 100,000-150,000 b/d, without any notification to the Sanctions Committee (MEES, 17 April).
Iraq's cross-border oil trade also includes around 70,000 b/d of crude oil and products which transit Iranian territorial waters to the southern part of the Gulf (MEES, 27 Dec. 1999/3 Jan. 2000).
While Syria and Iraq have been discussing the possibility of reopening the pipeline system between the two countries for years, the timing of the decision has significant regional implications.
The clear message from Damascus is that inter-Arab differences, particularly over Iraq, should be resolved in order to focus attention on the Arab-Israeli con-flict and the peace process.
It is also a clear signal to the US that it cannot turn a blind eye to the violation of the sanctions regime by its friends in the region (i.e. Jordan and Turkey) while expecting others to adhere to it.
More-over, and most importantly, the move reflects the widespread anger in the Arab world at the Americans' lack of even-handedness as far as the peace process and sanctions on Iraq are concerned.
The Iraq-Syrian pipeline system had a pre-closure capacity of 1.1mn b/d. It has been closed since 1982 as a result of the tension between Baghdad and Damascus over the Iraq-Iran war. Syria uses part of the system to export crude oil from the Dair al-Zur area produced by Shell and Elf Aquitaine production to the Banias export terminal on the Mediterranean.
It also utilizes another section - basically the 100-km section between pumping stations T-3 and T-4 - as part of the 377km gas-line running from the Jbeissah gas processing plant to the fertilizer complex and refinery in Homs (MEES, 5 January 1998).
The T-2 pumping station on the Syrian side has been repaired by Iraqi technicians, and Iraq will send Basrah Light crude from the south of the country through the strategic pipeline to Haditha and the T-1 pumping station, which is already the starting point for trucking crude to Jordan.
© 2000 Mena Report (www.menareport.com)