2020-09-10 14:20:00
IRAQ'S OIL REFINERY $4 BLN
PLATTS - 09 Sep 2020 - Iraq is in talks with ENI to build a 300,000 b/d refinery at an estimated cost of $4 billion near the Zubair oil field operated by the Italian company in the southern part of the country, the oil minister told a webcast with Jordan-based Iraqi Business Council.
The first phase of the project includes commissioning 150,000 b/d by 2025, Ihsan Ismaael said in the webcast posted online on Sept. 7.
ENI couldn't be immediately reached for comment.
ENI currently operates the Zubair oil field with a 41.56% stake, alongside partners South Korea's Kogas with 23.75%, state-owned Basra Oil Co. with 29.69% and another state partner with 5%, according to its website.
Zubair is set to produce 700,000 b/d by 2027, Ismaael said, without disclosing current production levels.
Iraqi investment
The ministry is seeking to attract the Iraqi private sector to own 20% of the project because the government does not have the resources to finance the project, the minister added.
The ministry will have off-take agreements to guarantee the sale of products, including gasoline, gas oil and lubricants, which will be consumed locally. Residues from the refinery are likely to be exported, Ismaael said.
OPEC's second largest oil producer imports gasoline and diesel to meet its needs and many of its refineries are either old, dilapidated or were damaged during the 2013-2017 war against the Islamic State.
Refinery expansions
North Refineries Co. is planning to ramp up processing capacity to 120,000 b/d by year-end from more than 75,000 b/d now, deputy oil minister Hamed Younis said in a statement Sept. 6.
The ministry plans to increase the capacity of the Sumood refinery in Baiji north of Baghdad to 280,000 b/d, Ismaael said Aug. 29.
Capacity will reach 140,000 b/d in the coming months from about 75,000 b/d now. The Baiji complex was extensively damaged by bombardments, siege and intense fighting between federal security forces and Islamic State during mid-2014 till the end of 2016.
Ismaael announced on July 29 that the Iraqi Cabinet had approved awarding Japan's JGC Corp. a $4 billion contract to upgrade the Basrah refinery, which has a capacity of 210,000 b/d. It is expected that upgrade work would start next year and last four years.
JGC said on Aug. 13 the upgrade includes constructing a fluid catalytic cracking unit, a vacuum distillation unit and a diesel desulfurization unit, among others. The project will increase production of gasoline to 19,000 b/d and diesel to 36,000 b/d.
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