IRAQ: Meter's are replaced at Iraq's main oil terminal in Basra; work is due to be completed in April

Record ID: 343773

  • Title: IRAQ: Meter's are replaced at Iraq's main oil terminal in Basra; work is due to be completed in April
  • Date: 6th March 2007
  • Summary: OIL TERMINAL TWO U.S. ENGINEERS OF PARSONS FIRM OIL TANKER AT BASRA PORT/OIL TERMINAL
  • Embargoed: 21st March 2007 12:00
  • Keywords:
  • Location: Iraq
  • Country: Iraq
  • Topics: Industry
  • Reuters ID: LVA3U1G3YV04HKP5AOSUR2NSHHJ2
  • Story Text: Work is underway at southern Iraq's Basra Oil Terminal, which is the main outlet for Iraq's oil exports, to update the metering system so that it will be possible to measure Iraqi oil exports according to international standards. Work is well underway to install a new, fully automated metering system at the Basra Oil Terminal in southern Iraq. The project involves the installation of 12 new metres and the the rebuilding of 10 others, to ensure that the measuring of crude oil exports loaded at the offshore terminal complies with international standards
    With Iraq's northern export pipeline from Kirkuk to the Turkish Mediterranean export terminal at Ceyhan mostly shut for security and technical reasons, the Basra Oil Terminal handles the bulk of Iraqi crude oil exports. As such is the main source of Iraq's revenues, a key supplier to the global energy market and an obvious target for insurgents aiming to thwart the country's economic recovery.
    The work is being carried out by U.S. engineering firm Parsons in co-operation with the Iraqi technicians of the terminal. The project is part of a wider plan to upgrade facilities at the Basra oil terminal
    The work includes installing 12 meters, six on each of the terminal's two platforms.
    "Ten new turbine metres have been installed and two more turbine metres will be installed by the Parsons firm. There will be 12 turbines of the same type installed on the platforms," Saad Yousif Mohammed, the head of Iraq's Ports Department said.
    According to Mohammed, local staff have emptied pipes of oil and prepared the location for Parsons to carry out engineering works and the installation of the new metering system.
    On completion of work, the meters will be checked by a third company and a certificate will be granted.
    Engineer Stuart Hunter of the Parsons firm said the refurbishment project of the terminal takes place in two phases.
    Phase one includes refurbishment of loading arms on berths 1 and 2. Phase two involves the refurbishment of all the emergency shutdown systems and metering systems on Platform A and replacing metres on Platform B with others of the same type as those installed on Platform A.
    "We are now 50 percent through the construction completion. Project is going extremely well. We have platform B when you go over there, you'll see that all the existing meters streams have been removed and ready for the same type of streams you see here on (platform) A. We have a current completion day of April. Things are looking on target at the moment," said Stuart Hunter, representative of Parson Firm.
    Hunter said that the firm would also introduce training for the associate staff to enable them to take over the operation and maintenance of the new system.
    The Basra Oil Terminal, previously known as Mina al-Bakr after Saddam Hussein's Baathist predecessor, is Iraq's only reliable oil export route.
    The terminal has a total of four berths, each with a capacity of 400,000 barrels per day (bpd).
    They are capable of handling very large crude carriers (VLCCs).
    A third terminal, Khor al-Zubair, mainly handles dry goods and minimal oil volumes.
    An adjacent port, Khor al-Amaya, has two berths, and has been exporting a few hundred thousand barrels per day because capacity to pump oil from southern fields to the Gulf remains limited and international shippers question the terminal's safety.
    Gulf War damage to the Basra Oil Terminal has been mostly repaired. Its nameplate loading capacity is 85,000 barrels per hour (around 2 million bpd), which is significantly above current capacity of about 50,000 barrels per hour (around 1.2 million bpd).
    A suicide attack against Basra port damaged one tanker berth in April 2004. In September that year, the Iraqi Oil Ministry signed a 15 million US dollar contract with Chinese company Sinopec to build eight oil storage tanks, with a total capacity of 350,000 barrels, on the Faw Peninsula in southern Iraq.
    There is a lack of storage tanks in southern Iraq, which means that oil exports virtually flow from the southern oil fields to the Basra Oil Terminal.
    Operations at the Basra Oil Terminal have been disrupted frequently since late last year by power cuts, insufficient storage and bad weather.
    Iraq's upstream oil sector remains in relatively poor shape, and the government is struggling to keep production from its fields falling further.
    Attacks on energy installations, political wrangling, lack of funds and mismanagement have plagued the energy sector since Saddam Hussein's regime fell following the U.S.-led invasion of the country.
    Home to the world's third largest oil reserves, Iraq pumped some 2.5 million barrels per day (bpd) and sold 1.7 million bpd before the 2003 U.S.-led war that toppled Saddam Hussein. Prior to the 1990 Gulf War, crude output levels were at around 3 million bpd.
    To reverse output declines, Iraq needs to ensure the flow of funds and restore security to allow for oil field maintenance. Production briefly hit around 2.4 to 2.5 million bpd in 2004.
    The oil sector, crippled by decades of war, sanctions and under-investment, was relatively steady before the 2003 war but has since lurched from one crisis to another. Analysts say if stability returns, it will take a year to hit pre-war output capacity, another few to reach pre-Gulf War capacity and then 6-8 years to raise capacity to 6 million bpd.
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