Increasing export capacity is a cornerstone of Iraq's
ambitious plans to revive its oil industry after years of war, economic
sanctions and neglect, and jump into the top ranks of global producers and
exporters.
Iraqi officials had expected to open the tap at the first
of three new single-point moorings (SPMs) on Jan. 1 but testing of new export
pipelines has not been completed.
Consultation between the Oil Ministry, the South Oil
Company and project manager Foster Wheeler last week produced the new schedule,
officials said.
"The final work of checking the new export pipelines
and other export facilities linked to the first floating terminal is expected
to be finished by the end of this month," Oil Ministry spokesman Asim
Jihad said.
Iraq's $1.3 billion export expansion project in the Gulf
includes the construction of two undersea pipelines and one onshore pipeline,
as well as four single-point moorings for loading tankers.
An engineer on the South Oil Company's export expansion
project said the construction of the twin 60-km pipelines that will carry crude
to the SPMs from shore had been completed but at least two more weeks were
needed to finish testing them.
"We were supposed to finish work on the project
earlier but we needed more time to do final checks for any possible leaks and
to complete the installation of pipeline valves," the engineer told
Reuters on condition of anonymity.
"We will definitely be ready to start exports at the
first single-point mooring by the end of this month," he said.
The other two moorings will be installed by the end of
the year, he said.
Iraq's current export infrastructure is outdated and
lacks the capacity to handle the expected large increases in production from
its southern oil fields.
The Baghdad government has awarded a series of massive
development contracts to foreign majors such as Shell, ExxonMobil and BP,
targeting output capacity of 12 million bpd by 2017. However, most analysts see
6 million to 7 million bpd as a more realistic goal.
Iraq is currently producing close to 3 million bpd while
exports averaged 2.165 million bpd last year, according to the State Oil Market
Organization.
Exports are expected to average 2.5 million bpd this
year.
Bringing the first three SPMs on line would boost Iraq's
export capacity in the Gulf by 2.7 million bpd, more than doubling Basra's
current capacity. Its two current Gulf terminals can handle around 1.7 million
bpd.
Iraq also has plans in place to build a third Gulf
pipeline and a fourth SPM, while a fifth SPM is on its wish list.
