Iraq's al-Hashemi: Baghdad to review oil accord with Jordan

May 29, 2008, 18:17 GMT

Amman - Iraqi Vice President Tareq al-Hashemi said Thursday that his government was mulling 'a review' of the oil accord that was signed with Jordan in August 2006 in order to address the impediments that prevented its implementation so far.

'The Iraqi government is keen on reviewing and reinvigorating the memorandum of understanding that provides for supplying Jordan with crude at preferential prices,' al-Hashemi said during a meeting with leaders of the Jordanian private sector.

'The Iraqi government is going to discuss again supplying Jordan with oil to know the reasons that so far hindered the implementation of the memo whether it pertained to the export outlets, transport, bureaucracy or other issues,' he added.

According to the agreement reached by the two countries in 2006, the Iraqi government pledged to supply Jordan with 10,000-30,000 barrels of crude per day at preferential prices.

Iraq also agreed to increase crude exports to Jordan gradually to eventually cover the entirety of Jordan's oil needs, which currently run at about 100,000 barrels per day, according to Jordanian officials.

Lack of protection on highways was cited by Jordanian officials as the main reason that delayed the regular implementation of the oil accord with Iraq.

To overcome the security shortcoming, the two countries reached an arrangement in September 2007 for Iraqi crude to be transported by Iraqi tanks to the Iraqi-Jordanian border, where the shipment could be picked up by Jordanian tanks.

However, the experiment faltered apparently after it hit security snags again.

Al-Hashemi, who is on a visit to Jordan in the course of an Arab tour, said that his country wanted to extend help to Jordan in terms of oil supplied at preferential prices to compensate it for the losses it incurred as a result of hosting more than 500,000 Iraqis.

He promised to give Jordanian firms priority in granting contracts for the reconstruction of Iraq which he said would start shortly after the restoration of stability in his war-torn country.

The Iraqi Vice president also discussed with Jordanian businessmen and industrialists means of enhancing the volume of trade between the two countries, which retreated to only 540 million dollars in 2007 from about two billions dollars before the US-led invasion of Iraq in 2003.