UAE major pipeline opens in June
Fujairah, May 28, 2012
A pipeline being built by the UAE to pump most of its oil exports from east coast terminals bypassing the Iran-threatened Strait of Hormuz, will be operational in June, the ruler of Fujairah said.
"It will be operational in June," Shaikh Hamad bin Mohammed Al Sharqi said.
Construction of the 360km pipeline began in 2008. It will have an initial capacity of 1.5 million barrels per day (bpd) rising to 1.8m bpd, which represents the bulk of the UAE's current production of around 2.5m bpd, he said.
The Habshan-Fujairah pipeline will carry oil from fields in Abu Dhabi on the Gulf to Fujairah on the Gulf of Oman.
Fears of a closure of the Strait of Hormuz intensified in recent months after Iran threatened to close it to the Gulf if Western governments kept up their efforts to choke off its oil exports to rein in its controversial nuclear programme.
In addition to the exports of the UAE and Iran, all the oil exports of Bahrain, Kuwait and Qatar are shipped through the waterway. Iraq also pumps the bulk of its exports through ports on the Gulf.
Saudi Arabia, the world's largest oil exporter, pumps most of its crude from its terminals on the Gulf but can divert large supplies to terminals on the Red Sea.
Shaikh Hamad, however, played down the possibility of a closure of Hormuz. "I don't believe there will a war," he said, arguing that the tension with neighbouring Iran is just a "summer cloud that will clear."
Iran held talks on Wednesday and Thursday in Baghdad with six world powers that nearly collapsed when they demanded that Tehran give up enriching uranium to the 20 per cent level seen as a key step towards weapons-grade.
In exchange, Iran would get inducements such as aircraft parts for its dilapidated commercial fleet and technical assistance in nuclear energy.
Iran said the inducements were far too little and countered with a demand that the P5+1 declare that it has a right to enrich uranium.