Iraq plans to introduce at the beginning of January discounts of as much as 20% on oil equipment import tariffs to support international oil company activity in the country, transportation minister Amer Abdul-Jabbar Ismael said Friday.
The discounts are in the final stages of preparation and will be approved by the cabinet in December, Ismael told Platts on the sidelines of an oil and gas conference in Basrah.
The discount, which will be exclusive to oil companies investing in Iraq, may be as much as 20%, with the exact number to be announced next month. He did not say what the current tariff was.
Ismael said one of the goals is to encourage the use of Umm Qasr port instead of land routes through neighboring countries. Oil companies have complained about the limited transit routes into Iraq and have charged that bureaucracy impedes everything from entry visas to supplies.
"Now Iraqi ports are ready to use any big ship," he said. "We never like to use other ports of other countries. This is no good for Iraq."
Vessels carrying supplies for the oil sector will be given first docking rights into Iraqi ports, Ismael said.
He also offered to make storage space available at Umm Qasr, railways for transporting equipment and supplies to project areas and the use of ministry trucks at a special discount, which he did not detail.
Iraq has awarded 14 upstream contracts -- 11 oil and three gas -- to foreign oil companies since November 2009 in an effort to increase oil production capacity to more than 12.5 million b/d and jump-start the gas sector.
Ismael also said the transportation ministry had bought two new tug boats with 5,200 horsepower, which would enable oil tankers to dock more quickly at oil terminals al-Basra and Khor al-Amaya and would also reduce the potential for weather-related delays as the tugs would be able to operate in poor conditions. Two additional tugs will be delivered next year, he said.
Iraq moves 80% of its oil exports through northern Gulf terminals al-Basra and Khor al-Amaya, both of which suffered damage in the 1980-1988 war with Iran and in the 1991 war after the invasion of Kuwait. Only 5% of exports from the south are from Khor al-Amaya, due to its smaller size and more extensive damage.
The discounts are in the final stages of preparation and will be approved by the cabinet in December, Ismael told Platts on the sidelines of an oil and gas conference in Basrah.
The discount, which will be exclusive to oil companies investing in Iraq, may be as much as 20%, with the exact number to be announced next month. He did not say what the current tariff was.
Ismael said one of the goals is to encourage the use of Umm Qasr port instead of land routes through neighboring countries. Oil companies have complained about the limited transit routes into Iraq and have charged that bureaucracy impedes everything from entry visas to supplies.
"Now Iraqi ports are ready to use any big ship," he said. "We never like to use other ports of other countries. This is no good for Iraq."
Vessels carrying supplies for the oil sector will be given first docking rights into Iraqi ports, Ismael said.
He also offered to make storage space available at Umm Qasr, railways for transporting equipment and supplies to project areas and the use of ministry trucks at a special discount, which he did not detail.
Iraq has awarded 14 upstream contracts -- 11 oil and three gas -- to foreign oil companies since November 2009 in an effort to increase oil production capacity to more than 12.5 million b/d and jump-start the gas sector.
Ismael also said the transportation ministry had bought two new tug boats with 5,200 horsepower, which would enable oil tankers to dock more quickly at oil terminals al-Basra and Khor al-Amaya and would also reduce the potential for weather-related delays as the tugs would be able to operate in poor conditions. Two additional tugs will be delivered next year, he said.
Iraq moves 80% of its oil exports through northern Gulf terminals al-Basra and Khor al-Amaya, both of which suffered damage in the 1980-1988 war with Iran and in the 1991 war after the invasion of Kuwait. Only 5% of exports from the south are from Khor al-Amaya, due to its smaller size and more extensive damage.
