Page 6 - MEOG Week 04 2023

MEOG PIPELINES & TRANSPORT MEOG

Iraqi crude resumes flowing into Jordan

IRAQ TRUCKS filled with Iraqi crude resumed cross- Cargoes resumed in September 2022 fol-
ing the border into Jordan this week, following a lowing a July agreement between Amman and
month-long hiatus. The resumption follows the Baghdad on the resumption, with Iraq complet-
latest three-month extension of a bilateral deal ing all of the required logistical preparations.
originally signed in February 2019, which has Former Jordanian Minister of Energy and Min-
been renewed several times since. eral Resources Hala Zawati said that crude flows
This deal provided for Iraq to supply 10,000 had stopped after prices fell below $20 per barrel.
barrels per day (bpd) – covering around 7% of The renewal comes just a few days after
Jordan’s oil demand – trucking crude from the Amman and Baghdad said that they would soon
Baiji refinery to the Jordan Petroleum Refinery begin implementing the Basra-Aqaba crude oil
Co. (JoPetrol) at Zarqa. pipeline, underpinning continually improving
After lengthy delays, the first batch of Iraqi bilateral relations.
crude was trucked from Baiji to Jordan via Meetings were held during a four-day visit to
Kirkuk in September 2019. Baghdad by Jordanian parliamentary speaker
Following the latest renewal, around 110 Ahmad Al-Safadi, with discussions covering the
trucks are expected to cross the border every day long-awaited pipeline, grid interconnection and
until the end of March. broader economic collaboration.
When the 2019 agreement was announced, it Al-Safadi’s Iraqi counterpart, Muhammad
was reported that Jordan would purchase the oil Halbousi, told a press conference: “We discussed
at a $16 per barrel discount to Brent in order to bilateral relations and important economic sec-
cover the transport and deviation in specifica- tors, as we discussed in detail the electrical grid
tions with Iraqi goods exported through the port connection [wire] between Iraq and Jordan.”
of Aqaba, receiving preferential rates in return. Meanwhile, “increasing the outlets for selling
However, in 2021 Alaa al-Yasiri, general Iraqi oil is an important issue, as it will increase
manager of Iraq’s state oil marketer Somo, told Iraq’s imports,” he added.
Iraq News Agency (INA): “The Oil Marketing Halbousi praised “Jordan’s positions in sup-
Company does not have differential prices, but port of Iraq” and said: “We highly appreciate
rather fixed prices according to the market … Al-Safadi’s visit to Baghdad and the Jordanian
Jordan stipulated that, according to the Cabinet’s support for the Iraqi people.”
decision, the transportation cost was calculated The project will be divided into two parts: the
at $11 from Baiji to Jordan, and this is among the first phase includes installing a 56-inch (1,422-
items of bilateral agreements between the two mm), 680-km pipeline with a capacity of 2.25mn
countries, and the supreme interest is valued by bpd from the Rumaila oilfield to Najaf, built in
the country and the government.” three phases.
With security issues in Iraq leading to a five- The second package covers the installation
year hiatus from 2014 to 2019, shipments were of a 42-inch (1,066-mm), 973-km pipeline from
severely affected again in 2020 by the pandemic Najaf to the Jordanian border and on to Aqaba
and the resultant drop in oil price led to several with a capacity of 1mn bpd. The latter will
pauses in supplies and no crude at all being sent include a spur carrying 150,000 bpd to the JoP-
to Jordan in August 2020. etrol plant and covering its full capacity.™

P6 www. NEWSBASE .com Week 04 25•January•2023