AMMAN, 29 October 2003 — Jordan will import oil from Iraq for the first time since the US-led war began, but the quantity will be half what it used to be, the Ministry of Energy and Mineral Resources said yesterday.
An agreement covering the import of 2.6 million barrels of Iraqi crude oil annually was concluded recently, the ministry’s secretary-general, Khaldoun Kteishat, told The Associated Press. He declined to provide details on where and when the deal was brokered.
Iraq was Jordan’s only supplier of oil before the war broke out on March 20.
Before the war to topple Saddam Hussein’s regime Jordan took all its oil from Iraq, importing 5.5 million tons annually by road, half of it free and the other half at a preferential price. With the outbreak of the war Jordan was obliged to seek supplies elsewhere at the market price, and the then Energy Minister Mohammad Batayneh put the annual bill at $1 billion.
Jordan turned to Kuwait, Saudi Arabia and the United Arab Emirates for its oil needs after Iraq’s flow was cut off.
The renewed oil supplies will be shipped by sea from Al-Bakr Port in Basra to Jordan’s Red Sea port of Aqaba, 215 miles south of the Jordanian capital, Amman, Kteishat said.
“The Iraqi oil will be hauled into Aqaba by tankers in three trips spread over a year period, with the first shipment expected in Jordan within two weeks,” Kteishat said.
He said the supply will “barely cover” Jordan’s daily oil need of around 95,000 barrels per day.
Kteishat said Saudi Arabia will cover the remainder of Jordan’s requirement until December. He declined to say if there were ongoing negotiations to receive more supplies from Iraq or other Gulf states.
The Iraqi oil will be bought at world market prices, Kteishat said. He estimated the barrel cost at $25 to $27 and said the total deal will be around $80 million per year.
The method of transport is likely to change to overland trucks, the way it was delivered previously.
“Shipping oil by sea will remain in place until land transport is secured,” Kteishat said, apparently referring to road hazards that include armed attacks on trucks and cars by highway bandits.