Iraq’s Downstream Dreams: Back To Square One?

Iraq harbors big ambitions to tackle its decades-old refined products shortage. But Oil Minister Thamir al-Ghadhban is pessimistic this can happen any time soon – especially with demand on the rise.

Over the last couple of years, Baghdad has talked a good game in its bid to solve its refining woes – woes that saw Opec’s number two oil producer import about 90,000 b/d of products in 2018, mostly diesel and gasoline. Former Oil Minister Jabbar al-Luaibi (2016-2018) would take every opportunity available to insist that Iraq’s war damaged refineries would be rehabilitated – usually within a year – and that the start of construction on long-delayed refining projects was just around the corner.

Even veteran oilman and recently appointed Oil Minister Thamir Ghadhban seems to have been convinced by the assuredly optimistic talk. “I had hoped, before I assumed duty [in October 2018], that several [refining] projects were ready for signature so I could sign all the various contracts.” Mr Ghadhban told MEES this week (see MEES, 12 April ). However, it soon became clear that “with at least four of the five projects, we had serious issues with the financial capabilities of those who the ministry was dealing with. Very serious issues. I found they were incapable of providing financing for the plans.” Of Iraq’s planned refining projects (see table), nearly all are at what Mr Ghadhban reluctantly describes as “point zero.” (CONTINUED - 1273 WORDS)

DATA INSIDE THIS ARTICLE

table Federal Iraq’s Current Refineries ('000 B/D)...
chart Iraq Gasoline Output ('000 B/D) Rose 8,000 B/D In 2018 But Still Meets Less Than Half Demand...
chart ...And Whilst Diesel Output ('000 B/D) Jumped 25,000 B/D, A 20,000 B/D Hike In Demand Largely Offset Gains