Iraq puts Kirkuk oil out to tender

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The Independent Online

Iraq announced a tender for delivery of Kirkuk crude yesterday, marking the first sale from its northern oilfields since the United States-led occupation almost a year ago.

Iraq announced a tender for delivery of Kirkuk crude yesterday, marking the first sale from its northern oilfields since the United States-led occupation almost a year ago.

The sale provides a boost for Baghdad's post-war reconstruction effort and should lift Iraqi crude exports in March above 2 million barrels a day for the first time since the war.

Oil prices are trading at 12-month highs, underpinned by fears that unrest in Venezuela could hit US oil stocks. Benchmark Brent crude was $33.35 in afternoon trade yesterday, within 25 cents of the year's peak it hit on Friday.

Baghdad reopened its pipeline through Turkey about 10 days ago,filling storage facilities at the Turkish Mediterranean port of Ceyhan. The Kirkuk line has been the target of numerous sabotage attacks since the war ended last May, particularly in the so-called Sunni Triangle north of Baghdad.

Iraq's US-led authorities had tried to avoid publicity on reopening the line for fear of provoking further bombings. A protection force of thousands has been employed to guard the line, which runs south-west from the Kirkuk fields to the Baiji refinery and then north-west across the Turkish border.

The tender document from Iraq's State Oil Marketing Organisation (SOMO) offers 6 million barrels for 12-19 March delivery from storage tanks at Ceyhan. The crude will be sold in shipments of one to two million barrels with a deadline for offers of 5pm on 10 March. In the medium term, Kirkuk deliveries are expected to reach post-war capacity of 800,000 bpd and eventually reach full capacity of 1.5 million bpd.

Baghdad also is planning a new pipeline from its southern fields across the eastern border to Iran's Abadan refinery. It also hopes to open a new export route through Kuwait and reopen an existing line to Syria.

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