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Still struggling to triumph over the grueling consequences of near-relentless confrontation and political negotiation, Iraq has nevertheless managed to weather the worst of the 2020 oil market crisis in its upstream sector. It has shown enough subtlety with its Kurdish exports, and more or less mastered its OPEC + default antics, to avoid the ire of major oil exporters. However, as Baghdad and other Iraqi cities experience the intense heat of August, when temperatures rise above 45 ° C, the Iraqi government has also started charting a course for the downstream segment of the country. Arabic, although a bit too ambitious given the current conditions. Iraq; one can simply argue that staying realistic is the most productive thing Baghdad can do. The only fully functioning Iraqi refinery is located in Shuaiba, close to the Basra crude production hub, where a 210 Mb / d refinery serves the wants of southern products. In general circumstances, Shuaiba would have had to process about 280 kbpd, employing a fourth refining unit, but the realities of being a war-torn Middle Eastern country and the COVID pandemic got in the way. Shuaiba has had a fair share of fighting in recent years, as the river water it relies on is getting increasingly salty and it has been forced to temporarily avoid refining because of it; It doesn’t seem so tragic in the COVID-19 era, when called in because the fall in fuels was, however, a damaging progression before that, given the lack of production from the Baiji refinery.
While the Shuaiba refinery satisfies southern Iraq’s product desires and the 140 kb/d refinery in Daura meets the demands of Baghdad’s burgeoning market, the unfortunate Baiji refinery (about 130 km from Baghdad) fulfilled the wishes of the center of the country. However, Baiji has suffered greatly as a result of heavy army operations: he first broke the barbaric movements of ISIS, just to take another one when Iraqi domestic forces recovered it in 2015. La last week, Iraq’s Oil Ministry set a deadline for the partially destroyed Baiji refinery complex, with a capacity of 310 kb/d, one of the main infrastructure assets that broke severely in the sudden Islamic State attack in Iraq.
Nominally, Baiji consists of 3 other portions: Salahuddin 1 and 2 (both with a capacity of 70 kb / d) and the Northern plant (capacity 170 kb / d). To date, only the Salahuddin 2 unit is working well – Salahuddin 1 has finished the maximum of its reconstruction paints in hydrogen and gas assemblies, but it has not yet restarted, and the northern plant requires maximum revision. The new Iraqi government said it hoped that all repair paints in Baiji would be completed until 2023. to maximize refinery production is more than apparent: despite its deficit budgets, Iraq spends about $2. 5 billion a year loading petroleum products.
The above developments can hardly be described as a success: in general, subsequent projects found investment disorders and subsequent delays. However, the Iraqi government continues to amaze the general public by claiming that the Middle Eastern country would build five new refineries with a total refining capacity of 790 kb/d. At the end of 2019, the Ministry of Petroleum published a list of the five refineries delivered: Kirkuk (70 kb/d), Wasit (140 kb/j), Nasiriyah (140 kb/j) ), Basra (140 kb/j) and al-Faw (300 kb/j). The specific selection of places raises apparent questions: if the government remains committed to bringing the Shuaiba refinery to its full capacity, why would it look for two more refineries in Basra governorate with an additional capacity of 440 kb/d (a total of 840 kb/d)?
Furthermore, Iraqi Kurdistan’s oil refineries make up a distinctive microcosm: Unlike the southern governorates, Erbil does not have a downstream power plant. , by an average of 20-30%. The only refinery in Kurdistan that operates more or less according to its technical functions is the 60 kb / d Ninewa refinery. The challenge is that in the context of OPEC commitments and subsequent investments falling in 2020, supplying Kurdish refineries (the last of which was commissioned in July 2019, the 40 kb / d refinery in Erbil) with really large amounts of crude oil is a complicated business.
By Viktor Katona for Oilprice. com
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