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Iraq awards pipeline contract to SNC Lavalin Group


Iraq has signed a consultancy contract valued at around US$13.5mn with Canadas SNC Lavalin Group for a strategic Oil Minister Abdul-Kareem Luaibi, Iraqs oil minister said.

The 18-month contract with SNC Lavalin, Canada's largest engineering and construction company, includes pipeline design, feasibility studies and preparation of tender documents for a pipeline project from oilfields in southern Basra province to neighboring Syria and Turkey. The project is expected to take four years to build.

"We have signed a contract with an international consultancy company to execute an important and vital project, which is an oil export facility," Oil Minister Abdul-Kareem Luaibi said.

Iraqi officials said last year they envisaged a pipeline corridor through Syria to the Mediterranean with one crude pipeline with a capacity of 1.5mn barrels per day and a second of 1.25mn bpd.

That would allow Iraq to broaden the range of crude export grades and diversify its markets, Luaibi said. Iraq needs to rapidly boost export facilities if it is to benefit from an expected large increase in production capacity.

The government has signed contracts with oil companies in a bid to boost output capacity to 12mn bpd by 2017, which could put Iraq in the top ranks of global producers. Luaibi said current political unrest in Syria would not affect the oil export pipeline project.

"It has nothing to do with the political situation in Syria ... the project is supported by the brothers in Syria, there is an MOU (memorandum of understanding) signed with the Syrians to execute this project."

Tender documents for the pipeline project should be ready within six months, Ghassan Ashqar, a senior vice president at SNC Lavalin said.