Iraq breaks ground on $6 billion Karbala refinery

Iraqi Prime Minister Noori Al-Maliki and his government have an agreement with a South Korean consortium to build a new refinery in Karbala. Costs are expected to be in the $6 billion range, resulting in a facility that produces 140,000 bpd. Hyundai Engineering and Construction will be the project leader.

"We are late in the building of this refinery, which was not our desire, but it is a consequence of the circumstances that faced the country, like the inheritance of the previous Baath regime policies of sabotage," Mr. Al-Maliki said at a groundbreaking ceremony.

“Today we are putting the corner stone to build the refinery which is considered as the newest and most developed in Iraq and has a production power that can meet the needs of the governorate and the other Middle Euphrates areas,” said Iraqi Deputy Prime Minister for Energy Hussain Al-Shahristani.

The facility is expected to produce a refined products slate of gasoline, liquefied petroleum gas, gasoil, jet fuel, kerosene, fuel gas, hard sulfur and paving asphalt.

The Karbala refinery is a centerpiece of the Al-Maliki government’s stated goal to convert Iraq from a country that imports most of its oil products to a country that supplies its domestic market and still has quantities allowing it to become a net exporter.

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