Iraq starts crude exports to China under oil for infrastructure deal

PHOTO

29 December 2019

Iraq has started exporting 100,000 barrels of crude oil per day to China since October under a 20-year oil-for-infrastructure agreement between the two governments, the financial advisor to the Iraqi government said.

Mudher Mohammed Saleh told Thomson Reuters Projects that the Chinese firms Zhenhua Oil and Sinochem were the importers, adding that the oil for infrastructure deal is expected to fetch Iraq an annual revenue of $2 billion at current international oil prices.

In September, China's state-owned news agency Xinhua had reported that the Iraqi Ministry of Finance and China Export and Credit Insurance Corporation (Sinosure) had signed a framework credit agreement to finance major infrastructure projects from the proceeds of Iraqi oil exports to China.

Saleh said the initial capital of the fund would be $10 billion, adding that the agreement has provided for future increase in the capital.es

The Chinese firms would implement infrastructure or strategic projects chosen by Iraq according to global standards at competitive prices, he added.

Iraq is OPEC's (Organisation of the Petroleum Exporting Countries) second largest oil producer and home to 12 percent of world's proven oil reserves, according to September 2019 report posted on CNBC.com.

(Reporting by Majda Muhsen; Editing by Anoop Menon)

(anoop.menon@refinitiv.com)

Disclaimer: This article is provided for informational purposes only. The content does not provide tax, legal or investment advice or opinion regarding the suitability, value or profitability of any particular security, portfolio or investment strategy. Read our full disclaimer policy here.