Global Arab Network | UAE delays oil pipeline to bypass Hormuz - Iran threatens to block the strait

Translate this article to your language:

GANPublications

e-Publications

Add Site to Favorites

Add Page to Favorites

Make Homepage

Share This Page

RSS Feed

--------------------------------------------------------------------------------------------------------------------
| |

UAE delays oil pipeline to bypass Hormuz - Iran threatens to block the strait

Global Arab Network - - Amina Murtada

Monday, 09 January 2012 15:27

http://www.english.globalarabnetwork.com/images/stories/2011/Feb/Kuwait_buys_new_oil_tanker_from_South_Korea-based_Daewoo.jpg

Global Arab Network - The United Arab Emirates has delayed the launch of a crucial oil pipeline to bypass the Straits of Hormuz to mid-2012, which analysts said would add to supply worries at a time when Iran threatens to block the strait for all the Gulf's oil.

Oil prices have remained elevated in recent weeks as Iran has threatened to block the strait should the West impose tougher sanctions on its oil industry as part of a standoff over Tehran's nuclear programme.

The narrow strip of water that separates Oman and Iran is the world's most important oil shipping lane, which connects the biggest Gulf producers such as Saudi Arabia, Iran, Iraq and the United Arab Emirates with world markets.

Flows through the strait are estimated at around 15-17 million barrels per day (bpd), or just under a fifth of global supplies, and a new pipeline would bypass it to carry most of the UAE's oil, 1.5 million bpd, to global markets.

"The pipeline is almost complete. Hopefully it will be operational within six months, by May, June," the UAE's oil minister, Mohammed bin Dhaen al-Hamli, told reporters on the sidelines of an energy conference in Abu Dhabi.

The previous deadline for the Abu Dhabi Crude Oil Pipeline (ADCOP) project was set in April.

"There is delay; it is a lot of work. It is not only construction of the project. but it also has to be filled," Hamli said, adding that its capacity could go up to 1.8 million bpd.

The first tests have been done on the pipeline, industry sources said, adding that the first cargo from Fujairah was scheduled for May.

"Iran's announcement that it will carry out another round of military exercises in the Strait of Hormuz in February kept crude prices near two-month highs last week," said David Wech from JBC Energy consultancy, adding that news about the UAE's pipeline delay was "adding to supply concerns".

The pipeline would link state oil firm Abu Dhabi National Oil Company's Habshan oilfields to the port of Fujairah, one of the top three bunkering hubs and a major oil storage terminal outside the Straits and on the Gulf of Oman.

Global Arab Network

Source: Reuters
http://www.reuters.com/article/2012/01/09/uae-pipeline-idUSL6E8C91EF20120109

Add comment

The opinions of the authors in articles published are theirs alone and do not necessarily reflect the views of Global Arab Network
------------------------------------------------------------------------------
Published comments are the opinions of private individuals and do not reflect the views of Global Arab Network