Analysis: Oil and Gas Pipeline Watch

Iraq makes major moves to move more oil to Turkey and Iran

In Tehran, Iranian and Iraqi oil officials signed a deal to send crude to a refinery in Iran, which would send the products back to Iraq.

Iraqi Oil Minister Hussain al-Shahristani and Kazem Vaziri Hamaneh, his Iranian counterpart, signed the dual pipeline deal during a visit last week. (Hamaneh was removed from his post over the weekend, though it likely wasn’t related to the Iraq deal.)

Details of the agreement were limited, including how the project would be funded.

Tehran would buy 100,000 barrels of oil a day, to be sent down the 32-inch pipeline from Iraq’s oil capital, Basra, to Abadan, the southwestern Iranian port, Iran’s Press TV reports. The oil would be sent to a refinery in Bandar Abbas and the fuel sent back to Basra via a 16-inch pipeline.

The two sides signed a similar memorandum of understanding about a year ago.

Iraq’s reserves are the third largest in the world, but it suffers from a severe fuel shortage. It produces about 2 million barrels per day of oil, selling more than three-fourths of it.

Meanwhile in Ankara, where Shahristani and Prime Minister Nouri al-Maliki visited last week as well, the two sides agreed on long-term projects for electricity and natural gas. Turkey is a major supplier of Iraq’s fuel purchases as well.

But a main issue is the lack of oil flow from Iraq’s Kirkuk area, second to Basra for the country’s oil importance, to a port in Ceyhan, Turkey.

The dual pipeline north has been so frequent a target of insurgents when it dips into Sunni-dominated territory that fixing it has been put on the back burner.

The Al-Sabah newspaper reports the Iraqi Oil Ministry has fixed the pipeline and will begin sending oil -- 300,000 barrels per day -- to one of Turkey’s main oil hubs.

Shahristani also said oil production in the south would pick up pace as work-overs increase on oil wells and fields.

Second Wales-to-Britain gas pipeline raises concerns

A document produced by National Grid, responsible for the country’s pipeline system, has generated concern by a member of Parliament because it would duplicate a pipeline that has already irked Welsh officials and residents.

Opposition to the first pipeline has led to delays. Opponents say it wastes energy and threatens the environment. It would send liquefied natural gas from Milford Haven to Tirley, Gloucestershire, approved without any public meetings, the Western Mail reports.

In the National Grid document, the second pipeline is mentioned as a way to meet any increased production and export capacity.

To add to the initial pipeline’s concerns, the second pipeline would likely cut through additional green space, the report says.

While a Grid spokesman said mention of the second pipeline is hypothetical, giving possible options, Parliamentarian Adam Price said it should then have been kept out of the document.

“The idea of a duplicate pipeline is contained in this consultation document that was sent to the significant players in the energy industry,” he said. “The first pipeline is supposed to provide Britain with 20 percent of its energy needs, so I presume that if a second pipeline goes ahead, between them they will supply 40 percent.”

Pakistan pushes forward pipeline with Iran, India

Pakistan’s president, Pervez Musharraf, said U.S. opposition to two U.S. allies doing business with Tehran will not squash the pipeline.

"Pakistan is pursuing policies in country's interest and the Iran-Pakistan-India gas pipeline project is one of the examples," he said, Iran’s Alalam News Network reports.

The pipeline would cost $7.4 billion and send 3.2 billion cubic feet of natural gas to India and 2.1 billion cubic feet to Pakistan. All of it would come from Iran’s gas fields, the world’s second-largest reserves. Russia, which by far holds the largest gas reserves, also wants in.

A number of questions remain, as well as U.S. opposition. The funding for the project hasn’t been finalized, nor has a price for the gas.

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(e-mail: energy@upi.com)