Iraq to proceed with construction of major refinery in Karbala Province

BAGHDAD -- Mr. Abdulkareem Liaybi, minister of oil, said that the Karbala refinery project is considered as one of the biggest projects in the oil refining industry in Iraq.

The ministers statement came after the approval of the council of ministers during its session on the 7th of January 2014 to award the project to the consortium of four companies led by Hyundai Korean Company.

The refinery will produce oil derivatives with international standards equivalent to the European standard, and a production power of 140,000 bpd.

The project will be applied by a consortium of four Korean companies led by Hyundai Company within 56 months at a cost of $6 billion, which will be covered from an investment budget of four years.

For the significance of the refinery project, the ministry hired the French company Technip, which is specialized in the oil projects to help the Iraqi staff in the project application. The production of the refinery will fill a part of the Iraqi provinces' needs, especially the middle class, and Baghdad -- in addition to the employment of local manpower and private-sector companies.

Mr. Assim Jihad, spokesman for the ministry of oil, said that the refinery project is considered as one of the significant projects in the history of refining for its cost and the quality of derivatives like the liquefied gas, normal and qualified gasoline, gas oil, fuel oil, jet fuel, kerosene, industrial asphalt and road asphalt. 

And it will fill a part of the local need for oil and feed the Khayrat power station that supply Karbala province with electricity, he added.

The refinery will take an area of 6 sq km on the southern part of Karbala province near a strategic pipeline, according to the designs of Technip, and it will contain units that operate with new environmentally-friendly technology, according to the environmental report in the contract.

The ministry of oil held previously an investment promotion to build four new refineries in many provinces in Iraq like the 300,000 bpd Nasirya refinery, and the Karbala and Karkuk refineries, which have 150,000 bpd each.

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