Baghdad (IraqiNews.com) – Iraq is moving toward the acquisition of supertankers to bolster its capacity for transporting and marketing crude oil globally—a strategic step intended to reduce transportation costs and enhance financial returns from crude exports.
The Iraqi Ministry of Oil is considering the purchase of 10 oil tankers as part of its efforts to develop its export infrastructure and expand options for delivering shipments to global markets.
The step is part of the government’s efforts to strengthen the role of the Iraqi Oil Tankers Company (IOTC) and leverage the ownership of maritime transport assets, which would provide greater flexibility in marketing crude oil and managing shipments.
The plan is considered crucial given Iraq’s desire to improve the terms of its oil sales and reduce the discounts associated with certain existing marketing and transportation arrangements.
In a televised statement, Iraqi Oil Minister Basim Khudair revealed that the ministry is considering the purchase of 10 supertankers, with an estimated total cost of $2 billion, according to Attaqa News.
According to Khudair, the projected fleet will have a total capacity of 10 million barrels since each tanker has a capacity of around one million barrels.
Owning these tankers would increase export earnings; estimates indicate that Iraq might save between 30 percent and 40 percent on the losses it presently suffers from price reductions.
The Ministry of Oil has more alternatives than only direct procurement; it is also considering proposals from specialist companies to establish joint ventures for the supply of oil tankers.
According to Khudair, one of the suggestions is specialized businesses funding the acquisition of tankers in exchange for a portion of the revenues made from the vessels’ operations, with the price paid over a period of three or four years.
Direct procurement is still a possibility, and the Iraqi government has said that it supports this approach.
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