Iran, Iraq to Sign Pipeline Deal

Iran and Iraq will sign a deal in the next few days to build a pipeline that would transfer crude from southern Iraqi oilfields to refineries in Iran, a senior Iranian official said yesterday. Iraq announced in May it had agreed to begin discussions with Iran over the pipeline that will carry 200,000 barrels of Iraqi crude to Iran per day.

“Based on this contract the Iraqi crude will be imported and oil products will be exported (to Iraq),” Iran’s first vice-president Parviz Davoudi said.

He said Iraqi oil minister Hussain Al Shahristani would visit Tehran “in coming days.” Davoudi was speaking after talks with Iraqi Prime Minister Nuri Al Maliki who visited Tehran on Wednesday and Thursday.

Iraq, which has faced chronic fuel shortages, is now looking to build four refineries and has asked Iranian firms to bid for such contracts across the country. Decades of wars, sanctions and underinvestment have slowed a recovery in Iraq’s oil output.

Shahristani said in May Tehran was keen to construct the whole pipeline but his country would also consider other offers. Iraq needs to attract investment from foreign firms to develop fields and boost output.

The value of the contract is yet to be announced.