Iraq-Ceyhan pipeline restart timetable slips again, March targeted

Quantum Commodity Intelligence - Officials in Iraq are targeting a March restart of crude exports via the troubled Kirkuk-Ceyhan pipeline, although complications could still cause further delays.

The Kurdish Rudaw media outlet reported an Iraqi government spokesperson saying over the weekend that "steps" have been taken to get crude flowing again to the Mediterranean export terminal.

"According to our information and the steps that have been taken, Kurdistan region's oil exports may restart this month," said the official, named by Rudaw as Bassem al-Awadi.

The latest reports come after an 'imminent' deadline was missed last week despite intervention from US officials, with the 450,000 bpd capacity pipeline coming up to two years since oil was last exported.

The spokesman added that more meetings might be needed to "reach a final outcome" but that they are in the "final stages of resolving the disputes," referencing recent talks between various parties.

Delays

The pipeline restart has faced multiple challenges, including Baghdad agreeing deals with Ankara and regional Kurdish authorities in Erbil, while international companies responsible for 60% of Kurdish oil output are also looking for contractual assurances.

In early February, the Iraqi parliament approved amendments to the federal budget law to authorize $16/b in production and transport fees for international oil companies operating in the region, but producers expressed disappointment after last week's talks.

Infrastructure, including the pipeline and pumping equipment, will also go through maintenance and safety checks after the extended period of inaction.

Iraq is also under close scrutiny from OPEC for persistent overproduction so if output from the north was to increase, Baghdad would be under heavy pressure to make additional cuts in the south of the country.