Wednesday, June 23, 2010

Iraq needs financing to repair rusty pipeline, develop gas

BAGHDAD – According To North Oil Company Director of Planning Dr. Hussein Gulam, the Iraqi oil industry is suffering technical problems and its budget is not substantial enough to develop its oil industry.
''The pipelines are very old and rusty; they need to be repaired," said Gulam, who added that 50 kilometers of the Iraq-Turkey crude oil pipeline need urgent renovation due to rust.
That pipeline, also known as the Kirkuk-Ceyhan oil pipeline, is a 600-mile pipeline. It is Iraq’s largest crude oil export line, and was built in the late of 1970s.
In 1979, the oil production in northern Iraq (mainly Kirkuk) reached more than one million barrels a day. However, North Oil Company can now produce only 670,000 b/d.
According to the Iraqi Oil Ministry, more than one billion cubic feet of gas is wasted in Iraq through uncontrolled flaring daily due to lack of modern equipment and proper engineering. Reports say that Iraq loses US$3,000 every minute as a result.
In Kirkuk alone, 150 million cubic feet of gas is flared daily, says Director General of the Northern Gas Company (Kirkuk) Dr. Huner Najeeb Hassan. "In other words, we can say Iraq loses $700,000-$800,000 every day just in Kirkuk because of gas flaring," said Dr. Hassan.
He said he needs no less than US$200 million in order to control the Kirkuk gas flare.

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