Iraq invites prequalification for oil export pipeline deal

29 April 2013

Bids for Iraq-Jordan pipeline due in December

Iraq’s Oil Ministry has invited international engineering firms and financiers to prequalify for its planned new crude oil export pipeline, which will run through Jordan, one of the largest oil infrastructure projects in the region, setting a 15 June deadline for the submission of documents.

State Company for Oil Projects (SCOP), a subsidiary of the Oil Ministry, plans to release the tender on 30 July, sources close to the project tell MEED.

SCOP has set an ambitious timeline for the estimated $10bn scheme. After prequalification documents are handed in on 15 June, a committee will review each submission, under pre-established criteria, announcing the results on 15 July.

Qualified firms will then be invited to bid on 30 July, with bids due to be submitted in stages, but with final priced proposals due by the middle of December. The evaluation of bids and the selection of a preferred bidder is expected to be announced by 31 December. The negotiation of the project’s contracts and financial close is planned for 2014.

Construction planned for two years from the beginning of 2014. Iraq’s first crude oil shipments through Aqaba to Asia could commence as early as 2016.

Known as the Iraq Export Pipeline Infrastructure Project (IEPIP), the scheme includes design, procurement, construction, operation and maintenance for a 1 million barrel a day (b/d) crude export pipeline over a 20-year concession period. It will be implemented on a build, own, operate and transfer (BOOT) contract basis.

The BOOT contract has been drawn up by Canada’s SNC Lavalin, which is acting as the Oil Ministry’s consultant.

The pipeline will run from the PS-5A pumping station in Haditha in the west of Iraq to the Port of Aqaba in Jordan. It will also include a tie-in for a potential 150,000 b/d branch pipeline to Jordan’s Zarqa refinery, as well as a parallel fuel gas pipeline which will supply the gas required for the crude pipeline’s pumping stations.

It will connect with Iraq’s planned new strategic oil pipeline, which is being built separately to the BOOT scheme, on an engineering, procurement and construction (EPC) basis. The existing strategic pipeline was built in 1974 to transport crude oil over 650-kilometres from Basra in the south to Hadith in the northwest. Due to lack of maintenance, its design capacity of 1 million b/d has been reduced to less than 150,000 b/d.

 Iraq Export Pipeline Infrastructure Project
Haditha to Aqaba crude oil pipeline1 million b/d crude oil pipeline. Follows the existing corridor of the de-commissioned Haifa pipeline and Arab Gas pipeline. To be built on a build, own, operate, transfer (BOOT) basis.
Basra to Haditha pumping station crude pipeline2.25 million b/d pipeline, to be built on an engineering, procurement and construction (EPC) basis. Funded by the Iraq government. Will be in place prior to the completion of the BOOT segment.
Fuel gas pipelinesTo run in parallel to the crude pipelines.
Tank farmsLocated at the port of Aqaba with total storage capacity of 1 million b/d for 7 days.
Pump station (PS-5A)The Main Pumping station will be located at PS-5A. This is not included in the BOOT scope, which only covers tie-ins, pressure and flow control facilities, launching and receiving facility and metering for oil and gas systems.
Intermediate pumping stationsThis covers the pumps,  electrical  power  generation,  fuel gas treatment plant,  flare system, sewage/waste water treatment system, administration buildings and accommodation facilities.
Custody Metering StationLocated at the Iraq-Jordan border, this will include scraper launchers and receivers, closed drain system, re-injection facilities a manifold with metering skids and the related infrastructure including diesel power generation and buildings.
Marine export facilities at AqabaTwo crude oil ship loading jetty berths and associated facilities.
Source: SCOP

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