RIYADH, 21 June — High-level sources have reaffirmed the Kingdom’s right to seize the “Iraqi” oil pipeline saying that Baghdad has not paid the SR94 billion ($25 billion) it owes to Saudi Arabia in debt repayment besides an undisclosed amount in war reparations.
Saudi Arabia announced on June 11 that it was taking over the $2 billion facility stretching from Abqaiq to Yanbu. Prince Sultan, second deputy premier and minister of defense and aviation, said on Sunday the pipeline was fully owned by the Kingdom.
“The pipeline was constructed by Saudi Arabia on its territory using its money to facilitate Iraq’s oil exports,” the prince said.
Speaking to Arab News, the sources said Saudi Arabia had left the resources of the Arabian Oil Company and Texaco, both in the neutral zone and in Khafji, at Iraq’s disposal following the closure of an Iraqi pipeline that passed through Syria during the 1980-88 Iran-Iraq war.
The sources pointed out that Saudi Arabia and Iraq had signed an agreement to construct the pipeline using Saudi funds to provide an outlet for Iraqi oil. They said the Kingdom had deposited all the income from selling oil in the pipeline after the Kuwait war broke out in a United Nations fund.
The sources said it was not in the interest of Saudi Arabia to export Iraqi oil across its territory. “The circumstances that led to the establishment of the pipeline have changed. Now Iraq can export its oil through Al-Bakr port on the Gulf and has the facilities to export 2.5 million barrels daily,” they added.
Saudi Aramco constructed the “Iraqi” pipeline using the same standards and technology employed in building other pipelines in the country. They said the Kingdom did not charge Iraq any fee for using its territory or did not ask it to bear the expenses of maintaining the pipeline.
Asked what action the Kingdom would take if Iraq lodges a complaint at the United Nations against the pipeline seizure, the sources said Riyadh would present documents to prove its right of ownership. The Kingdom would also take every step to retrieve its claims against Iraq in debt repayment and war reparations, they added.
