Iraq has started work on a pipeline linking Basra to Haditha with a capacity of 2.5 million barrels per day, as Opec's second-biggest oil producer seeks new routes to export crude.
About $1.5 billion has been allocated for the project and the date of completion depends on the availability of further budget allocations, the Iraqi News Agency has reported, quoting a Ministry of Oil representative.
The 700-kilometre pipeline will transport crude for export through routes such as Baniyas in Syria, Ceyhan in Turkey and Aqaba in Jordan, while also supplying refineries across southern, central and northern provinces of Iraq.
“The Basra–Haditha oil pipeline is a highly important strategic project,” said Ministry of Oil spokesperson Sahib Al Bazoun.
A contract has been signed by the Ministry of Oil and the Ministry of Industry and Minerals, with pipes to be manufactured domestically, he said.
Middle Eastern countries are focusing on developing alternative routes to bypass the Strait of Hormuz, which has remained effectively shut since the Iran war broke out on February 28.
Iraq's exports, which averaged 3.4 million bpd before the war, have dropped sharply. In March, Baghdad piped oil from its Kirkuk fields to the port of Ceyhan after striking a deal with the Kurdistan Regional Government. Exports are also being carried through Syrian terminals.
Saudi Arabia has been exporting oil through the East-West crude pipeline that connects Abqaiq to Yanbu on the Red Sea coast, while the UAE relies on a pipeline running from Habshan in Abu Dhabi to Fujairah to export its oil.
Mr Al Bazoun said maintenance and repair work on the Kirkuk-Ceyhan pipeline, which sustained major damage when ISIS was at the height of its power in Iraq, is now in the final phase.
The Iraqi Oil Ministry is now in the final stages of inspection, paving the way for the resumption of exports soon at a capacity of up to 600,000 bpd. The line has a capacity exceeding one million bpd.
