Iraq: New Oil Minister Seeks Investors For Four New Refineries

Iraq’s newly-appointed Oil Minister Jabbar al-Luaibi plans to invite technically qualified companies to bid for contracts to build four new refineries with a combined crude processing capacity of 420,000 - 470,000 b/d.

Mr Luaibi wasted little time after his appointment on 15 August in setting out his top priorities. Alongside the refining expansion the other two are increasing oil and gas output by boosting exploration and investment (see p2) and improving the provision of petroleum products to citizens (MEES, 19 August).

Additional capacity is much needed. Refinery production averaged just 430,000 b/d in first half 2016, with demand of 580,000 b/d necessitating imports. Although Iraq’s nameplate refining capacity is 900,000 b/d, the reality is that more than a third of this is offline due to severe damage. The largest refinery, 310,000 b/d Baiji, was heavily damaged in fighting between so-called Islamic State (IS) and federal forces beginning in June 2014. More recently, the 14,000 b/d Qayara refinery was virtually destroyed by IS fighters as they withdrew in July. The upshot is that even under the most optimistic calculations, capacity is just 566,000 b/d (see table). (CONTINUED - 638 WORDS)

DATA INSIDE THIS ARTICLE

table Federal Iraqi Refineries ('000 B/D)