Wednesday October 28, 2009

Iraq oil pipeline to resume pumping after blast

By Ahmed Rasheed

BAGHDAD (Reuters) - A bomb planted by suspected insurgents on Monday damaged the Kirkuk pipeline that takes crude from northern Iraq to the Turkish port of Ceyhan, but pumping will resume in the next few hours, officials and police said on Wednesday.

Attacks against Iraq's oil infrastructure have declined as violence subsides and Iraq tries to rebuild after years of war, sanctions and strife. It is working on deals with oil majors that would substantially boost output in a nation with the world's third largest crude reserves.

"The Ceyhan strategic pipeline was hit by a blast Monday morning causing damage to the pipeline. Immediately, the pumping was halted. The repair crew started fixing the damaged section and it is expected to resume pumping in the next few hours," Oil Ministry spokesman Asim Jihad said at 1200 GMT.

Jihad and an engineer with Iraq's North Oil Company, who asked not to be identified, said the blast happened near Mosul, a volatile city still suffering frequent attacks by insurgents 390 km (240 miles) north of Baghdad.

Police in Mosul said insurgents carried out the attack, the first significant strike on an Iraqi pipeline in months.

Trading sources in London said flows might resume later on Wednesday, but others said it could be longer.

Iraqi oil officials said crude exports had not been affected because there was still oil in storage.

In September, exports from Iraq's Kirkuk fields through the northern pipeline to Ceyhan reached 490,000 barrels per day, according to Iraqi officials.

"There is a glitch in the Kirkuk-Ceyhan pipeline, but export is going on normally at Ceyhan port," said Falah Alamri, head of Iraq's State Oil Marketing Organisation. "We have our main storages in Ceyhan. We have enough crude in the storages."

An oil trader said the halt to flows had resulted in some oil tankers having to wait at the Ceyhan terminal.

While violence has fallen through much of Iraq over the last 18 months, bombings, shootings and other mayhem are still common in Baghdad and the northern areas. Political analysts say Iraq may face more bloodshed ahead of a national vote in January.

Iraq is in the process of signing a raft of deals with some oil majors to develop crude and gas fields and plans to auction off 10 undeveloped fields in mid-December, its second tender since the 2003 U.S. invasion.

(Additional reporting by Mustafa Mahmoud in Kirkuk and Alex Lawler in London; Writing by Jack Kimball; Editing by James Jukwey)

News Poll

Latest Jobs from Star-Jobs

Latest from StarProperty