Amman mulls building a pipeline to Zarqa
The Energy & Mineral Resources Ministry is considering plans to build a $350 million crude oil pipeline from the southern port of Aqaba to the kingdom's sole crude refinery at Zarqa as part of a $1,250 million project to modernise and expand the facility (MEED 7:7:06).
The news follows a review by the ministry of five options to supply the refinery with crude oil that included: transporting crude overland from Iraq by road or pipeline; importing oil through an existing pipeline from Saudi Arabia, known as the ‘tapline'; or by carrying shipped oil by rail from Aqaba port.
'A pipeline from Aqaba to Zarqa is considered the most feasible option at the moment. Other options, such as importing crude from Iraq are out of the question, and the old Saudi tapline is broken up in places and would have to be repaired - Riyadh has not shown interest in upgrading it,' say sources close to the project.
In early August, the ministry signed a memorandum of understanding with the Iraqi Oil Ministry for a potential pipeline from Iraq to Zarqa refinery. A separate agreement was also concluded to supply the kingdom with 30,000 barrels a day (b/d) of Iraqi crude.
The Zarqa expansion aims to upgrade the refinery to meet tighter environmental standards such as Euro 4 and raise refining capacity to about 130,000 b/d from 25,000 b/d. The project, which is expected to be completed by 2010-11, is part of the restructuring programme being carried out by Jordan Petroleum Refinery Company (JPRC) , which operates and manages the refinery.
The ministry has set a date of early 2007 to issue expressions of interest for new logistics and marketing companies as part of the JPRC restructuring. Citigroup is the financial adviser on the refinery scheme. The UK's Channoil Consulting is carrying out due diligence on the assets of JPRC and is due to complete its study by the end of 2006.
An international law firm identified as Houston International Business is carrying out a legal and regulatory framework study, which will look at downstream licences for JPRC.
The Energy & Mineral Resources Ministry is considering plans to build a $350 million crude oil pipeline from the southern port of Aqaba to the kingdom's sole crude refinery at Zarqa as part of a $1,250 million project to modernise and expand the facility (MEED 7:7:06).
The news follows a review by the ministry of five options to supply the refinery with crude oil that included: transporting crude overland from Iraq by road or pipeline; importing oil through an existing pipeline from Saudi Arabia, known as the ‘tapline'; or by carrying shipped oil by rail from Aqaba port. 'A pipeline from Aqaba to Zarqa is considered the most feasible option at the moment. Other options, such as importing crude from Iraq are out of the question, and the old Saudi tapline is broken up in places and would have to be repaired - Riyadh has not shown interest in upgrading it,' say sources close to the project. In early August, the ministry signed a memorandum of understanding with the Iraqi Oil Ministry for a potential pipeline from Iraq to Zarqa refinery. A separate agreement was also concluded to supply the kingdom with 30,000 barrels a day (b/d) of Iraqi crude. The Zarqa expansion aims to upgrade the refinery to meet tighter environmental standards such as Euro 4 and raise refining capacity to about 130,000 b/d from 25,000 b/d. The project, which is expected to be completed by 2010-11, is part of the restructuring programme being carried out by Jordan Petroleum Refinery Company (JPRC) , which operates and manages the refinery. The ministry has set a date of early 2007 to issue expressions of interest for new logistics and marketing companies as part of the JPRC restructuring. Citigroup is the financial adviser on the refinery scheme. The UK's Channoil Consulting is carrying out due diligence on the assets of JPRC and is due to complete its study by the end of 2006. An international law firm identified as Houston International Business is carrying out a legal and regulatory framework study, which will look at downstream licences for JPRC.This content is only available to full MEED package subscribers (MEED magazine and MEED.com).
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