First Iraqi oil shipment arrives at Jordan's border: Minister

Sep 23, 2008, 13:45 GMT

Amman - The first shipment of oil from Iraq to Jordan arrived at the Iraqi side of the border and is expected to enter Jordanian territory later in the day, Jordan's Minister of Energy and Mineral Resources Khaldoun Quteishat said Tuesday.

He said the shipment was carried by 16 cargo tankers that were scheduled to unload at the Jordan Petroleum Refinery near Zarqa, 30 kilometres east of the capital Amman.

Over the past three days, a total of 18,500 barrels of Iraqi oil were loaded by tankers for Jordan from the Kurdish region's Biji station, one of the three main refineries in Iraq, Quteishat said.

He conceded that difficulties still hindered the arrival of Iraqi crude to Jordan 'but we hope to overcome these snags through cooperation with the Iraqi side.'

Jordan signed a memorandum of understanding with Iraq in 2006 to supply the Hashemite Kingdom with Iraqi crude at preferential prices, but lack of security blocked the application of the agreement.

'We hope to arrange with the Iraqi authorities the loading of 10,000 barrels per day, which is the targeted quantity at the start,' Quteishat said.

The Jordanian and Iraqi governments signed an agreement in August whereby Baghdad agreed to increase the discount granted to Jordan to 22 dollars per barrel from 17 dollars, which was agreed in the 2006 memorandum, he added.

Iraq emerged as Jordan's main supplier of energy between August 1990 and March 2003, but Iraqi oil supplies to Jordan were stopped on the eve of the US-led invasion of Iraq on March 20, 2003.

The former regime of late Iraqi president Saddam Hussein used to supply Jordan with crude and oil derivatives at half the world market price.

Jordan, which consumes about 100,000 barrels of oil daily, has been forced to pay a steep energy bill since 2005, when Saudi Arabia, Kuwait and the United Arab Emirates cancelled the oil grant they extended to the Hashemite Kingdom in 2003.