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Europe Is Awash With Oil Stored On Ships

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Bullish sentiment in markets makes…

Zainab Calcuttawala

Zainab Calcuttawala

Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on…

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Iraq To Expand Oil Production Capacity Via Manmade Island

Oil

Iraq’s latest attempt to expand oil production capacity has the oil ministry considering a plan to inject seawater into underwater crude deposits from a manmade island, according to a new report by Bloomberg.

Iraq has also sought bids from six companies to complete a $4 billion project, which would make onshore fields in the south more productive. Ihsan Abdul Jabbar, director of the state-owned Basra Oil Co., told Bloomberg that the ministry already received five bids from companies interested in creating new processing capacity at the 450,000-barrels per day Majnoon field.

The artificial island experiment is a joint study with a Dutch company to construct a land satellite off the Gulf coast with a 10 million-barrel storage facility with a 2-million-bpd export capacity on its banks.

“Let’s say we have rough weather. The tankers will be taken to a safe zone, and when the rough weather ends, we will have many vessels and not all will be able to come for loading as the waiting area will be busy,” he said. “But if we have more than one terminal, once the rough weather ends, they all can come to get crude loaded.”

The Iraqi oil executive said the island would increase the reliability of Iraqi oil exports, which have largely recovered since the damaging effects of the war against the Islamic State. Baghdad declared the end of the official military campaign against the terrorist organization late last year.

“If damage occurs to one of the jetties, the maintenance takes months. If we have rough weather, it also takes two days from export capacities,” Abdul Jabar said. “To secure your business, export capacities must be 1.5 times greater that output capacities to overcome any problems of having output but being unable to export.”

By Zainab Calcuttawala for Oilprice.com

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