Jordan says Iraq to supply crude from Al Qaem at $37/barrel

Amman (Platts)--21Dec2006

Jordan's minister of Energy and Mineral Resources Khalid Shraydeh on
Thursday said that Iraq, under an agreement signed between Amman and Baghdad
in August, will charge Jordan $18/barrel less than the international price for
each barrel of oil.
Iraq signed an agreement in August to supply Jordan with 10,000 b/d of
crude, enough to meet 10% of the country's demand. Al Ghad Daily quoted the
minister as saying also that oil will most probably come from Al Qaem, 700km
away from the Jordanian Iraqi borders rather than Beiji.
The daily quoted Jordanian oil officials as saying that under this
arrangement, Jordan would pay around $37/barrel because it already pays $5
less per barrel for light Brent that can be refined in Jordan Petroleum
Refinery in Zarqa.
However, the daily said officials were still skeptical on when the crude
would arrive, citing security threats as a major obstacle. But Shraydeh said
he was positive that a solution will be found soon. "I was assured by Prime
Minister [Nouri] Maliki when he visited Jordan last month that the Iraqi
government was working on this and is very keen to supply Jordan with Iraqi
oil as soon as possible," the minister said.
Iraqi oil supply to Jordan was disrupted after the start of the war on
Iraq in 2003, prompting Jordan to rely temporarily on oil grants from Saudi
Arabia, Kuwait and the UAE which were also stopped last year. Since the 1991
Gulf War, Baghdad had been exporting around 80,000 b/d of crude to Jordan,
partly at market prices and the rest at undisclosed concessionary terms.

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