Within the oil and gas sector, the south of Iraq has received the most attention. The Basra region exported approximately 81 per cent of the country’s 67 million barrels in January, bringing in almost $5bn. Exports from the north to Turkey earned only $1.2bn.
This could change by the end of the year if the Oil Ministry pushes ahead with plans to raise its northern export capacity to 1 million barrels a day (b/d) from about 800,000 b/d currently. Baghdad is also aiming to expand exports at Basra, doubling its capacity to 4.5 million b/d from 1.8 million b/d today.
Iraq hopes to raise its crude oil production capacity to 12 million b/d by 2017, five times higher than current production. Hitting only half that amount in the time set will be a massive achievement. To cope with the increase in production capacity, Iraq will have to more than triple its export pipeline network capacity from the current 2.5 million b/d.
The extra volumes going north from Iraq will take some of the pressure off Basra, which is overhauling its own export infrastructure. A 2008 report by the US’ Foster Wheeler warned that the southern port requires a complete overhaul if Iraq’s ambitions are to succeed. It also concluded that excessive corrosion levels in major pipelines placed them at risk of failure.
If Iraq can get moving on the northern pipeline repairs, it will stand in good stead to proceed with plans to diversify its export options, particularly into neighbouring Syria.