Iraq & Jordan Agree on Building Oil Pipeline

Source: Reuters 1/3/2011, Location: Middle East

Iraq and Jordan have agreed in principle on building a pipeline to supply Jordan with crude oil for the coming decades, officials of the neighbouring countries said on Monday during a visit by Jordan's prime minister.

Ali al-Dabbagh, spokesman for the government of Iraqi Prime Minister Nuri al-Maliki, said at a news conference with Jordanian Deputy Prime Minister Ayman al-Safadi that Iraq's current supply of 10,000 barrels per day to Jordan by truck did not meet its needs.

"Iraq and Jordan agreed in principle to establish an oil pipeline to transport crude oil to al-Zarqa refinery in Jordan," Ali al-Dabbagh told reporters.

Neither official provided any further information or cited a cost for the project.

The two countries also discussed jointly developing a cross-border gas field, Dabbagh said, as Jordan Prime Minister Samir al-Rifai visited Baghdad on Monday to discuss various issues of common interest.

Iraq agreed in 2008 to a three-year deal to supply Jordan with 10,000 bpd of crude under preferential terms. The amount covers 10 percent of Jordan's energy needs of around 100,000 bpd.

Maliki, a Shi'ite, has sought to improve relations with Iraq's mainly Sunni-led Arab neighbours. Many Arab states have watched the rise of Iraq's Shi'ite majority to political power in the wake of the 2003 U.S.-led invasion with suspicion, concerned about Shi'ite Iran's growing influence.

Maliki last month won parliamentary approval for his second government, which includes a Sunni-backed alliance that won the most votes in an election last March.

"Iraq is interested in this project, and it's considered a strategic project for Jordan and will ensure Jordan is supplied with crude for decades," Dabbagh told reporters.

Iraq's total crude exports amount to around 2 million barrels per day.


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