Iraq, a major buyer of oil products, is set to import around 950,000 tonnes of gasoline and gas oil in the fourth quarter, the country's deputy oil minister told Reuters on Thursday.
Speaking by telephone from Iraq, Dr. Ahmed al-Shamma said rapidly growing demand meant the country would need to import 681,000 tonnes of gasoline and 270,000 tonnes of gas oil in the last three months of 2011.
That's the equivalent of around 62,900 barrels per day (bpd) of gasoline and 22,000 bpd of gas oil.
"Demand has risen to incredibly high levels, especially with generator use and the number of cars coming into the country," Shamma said.
"Demand should continue to rise but it may level off slightly as there is less demand for cooling or heating in the fourth quarter."
Iraq's State Oil Marketing Organization (SOMO) awarded a tender to buy up to 1.3 million tonnes of gasoline for the second half of this year in July, trade sources said, but the latest figures suggest extra imports will be needed.
Shamma also said Iraqi crude oil exports could rise to 2.4-2.5 million barrels per day (bpd) by the end of the year, up from around 2.2 million bpd in September.
"Demand is good," Shamma said. "There hasn't been any problem in marketing Iraqi crude this year."
Earlier this month Iraq's Oil Minister Abdul-Karim Luaibi said he saw crude exports averaging 2.5 million bpd in 2012.
OPEC member Iraq is pushing to ramp up its oil production and domestic refining capacity after years of war and sanctions and has signed a series of deals with foreign oil firms.
Shamma said he would be attending the Iraq Mining Conference in London on September 7-8 with details of new refinery projects the oil ministry is planning to partner with international oil and engineering companies on.
Iraq is hoping to attract more foreign firms to Iraq and is looking to diversify its economy away from just the oil sector. The conference aims to promote Iraq's potential for base metal production, minerals and finance.
The government has signed contracts with oil companies in a bid to boost output capacity to 12 million bpd by 2017, which could put Iraq in the top ranks of global producers, though many analysts have said the targets are overly ambitious.
Iraq's 2011 budget was $82.6 billion based on an average oil price of $76.50 per barrel and the deficit at $13.4 billion.
Oil minister Luaibi said earlier this month oil revenues alone could reach more than $80 billion this year, with international prices averaging close to $110 a barrel so far this year.
Shamma said Iraq's crude exports were already starting to push up against limited pipeline capacity.
But he said they expected to have completed the first part of an extension to the pipeline network by the end of 2011 that could add around 1 million bpd of export capacity, with a total export capacity of 5 million bpd by 2015.
"I don't think Iraqi crude production is going to exceed that level by the end of 2013," Shamma said.
Ambitious plans to grow oil production rapidly to help fund the country's reconstruction have also been hampered by limited fresh water supplies.
Both Iraq and Syria have criticized Turkey for monopolizing water supplies from the Euphrates and Tigris rivers via a series of hydropower dams.
Shamma said the Iraq Oil Ministry is working on one possible solution with International Oil Companies (IOCs) involving pumping seawater to the fields for desalination, though the amount of energy required may prove a stumbling block.
"You know we are having some problems with our neighbors. Most oilfields require a great deal of water, the quantities are beyond what we have," Shamma said
"We are working on a project with IOCs to use seawater than can be reprocessed and used again. We don't have the full details yet but we do know the energy required for this won't come from the electrical grid."
August 25, 2011 (Reuters)
(Reporting by David Sheppard; Editing by David Gregorio)
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