Iraq launches new oil refinery to reduce imports

Iraq opened an oil refinery in the city center of Karbala on Saturday, a project the government hopes will reduce its dependence on imports.

Oil Minister Hayan Abdel Ghani announced that the refinery had begun “commercial production” after a ribbon-cutting ceremony led by Prime Minister Mohammed Shia al-Sudan.

It has the capacity to refine 140,000 barrels per day and “help meet local demand for petrol, kerosene and heating oil, while reducing imports”, Abdel Ghani said.

Despite its huge oil and gas reserves, Iraq is still dependent on imports to meet energy needs.

The minister said the refinery, built by South Korean firm Hyundai, can produce nine million liters of fuel per day – more than half of Iraq’s daily imports of 15 million litres.

The refinery also has the capacity to produce 200 megawatts of electricity of which “60 megawatts will be allocated to the national grid”, said Abdel Ghani.

Iraq, the second largest producer within the Organization of the Petroleum Exporting Countries (OPEC), exports an average of 3.3 million barrels of oil per day.

Crude exports account for about 90 percent of government revenue.

Because of the years of conflict, Iraq’s crumbling infrastructure and endemic corruption have hampered reconstruction efforts.

The Karbala refinery is “the first to be built since the 1980s with such production capacity”, an oil ministry official told AFP when tests were held in September.

Three other refineries operating across Iraq meet about half of the country’s demand for refined products and the rest is imported.

In March, the prime minister announced a campaign to tackle the serious impacts of climate change on the water-scarce country, including by promoting clean and renewable energy.

Sudan said Iraq was “moving forward with concluding contracts to build renewable energy power plants to supply one-third of our electricity demand by 2030”.

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