A New North-South Iranian Pipeline?

According to today’s WSJ, Iran is planning to construct a new north-south oil pipeline in a bid to raise the volume of crude oil swap capacity with its northern neighbors from 150,000 barrels a day to around 1 million barrels a day.

The plan, which is intended to display Iran’s energy capabilities in the region, envisages the construction of a pipeline that would run across Iran from the city of Neka, in the Caspian Sea province of Mazandaran, to the Gulf of Oman port city of Jask in Hormuzgan province.

“This is a very grand and strategic decision for the country which based on projections would raise the crude oil and derivatives’ swap capacity from the current 150,000 barrels a day to 1 million barrels a day,” the Oil Ministry’s information network quoted Nozari as saying.

Nozari said Iran is already involved in oil swap with the Caspian Sea republics, but construction of the pipeline would make it possible for these landlocked countries to transfer their oil at lower costs to international markets. Nozari said Iran is determined to go ahead with the construction of the pipeline, the final decision on whose details would be made next week.

If built, then we can expect to see other Central Asian republics with access to the Caspian Sea — or those in the Caucasus which have agreed on oil swap with Iran — transfer their oil to Neka from where it would be pumped to a refinery in the northwestern Iranian city of Tabriz or to a refinery south of Tehran in much larger quantities than at present.

This entry was posted on Monday, August 27th, 2007 at 2:39 pm and is filed under Azerbaijan, Iran, National Oil Company of Iran, Russia, Turkmenistan.  You can follow any responses to this entry through the RSS 2.0 feed.  Both comments and pings are currently closed. 

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