UAE oil company wins tender to swap Iraqi oil

(FILES) In this file photo taken on July 05, 2012 Smoke rises from the chimney's of Lebanon's electricity power plant in the town of Zouk Mosbeh north of Beirut. AFP / Joseph EID

BEIRUT: Lebanon’s of Energy and Water Ministry said Thursday that the Emirates National Oil Company (Enoc) won the first tender to replace 84,000 tons of black fuel from Iraq to Lebanon.

The UAE company is expected to supply Lebanon’s aging power plants with the special diesel and gasoil to improve the electricity output and thus reduce the severe electricity rationing.

Lebanon and Iraq signed a contract last month in Baghdad to supply the country with 1 million tons of fuel which will be swapped with another diesel and gas fuel that can run the power plants.

ENOC will swap the Iraqi oil with HFO Grade (A) and / or HFO Grade (B) and / or gasoil that will be shipped to Lebanon to run the country’s power plants.

“After informing the Iraqi side of the final result, the winning company will bring the swapped fuel to Lebanon two weeks after receiving the shipment of black oil from Iraq between Sept. 3 and 5,” the Energy Ministry said in a statement.

The statement added that the Iraqi side had pledged to supply Lebanon with 1 million tons of swapped oil over the next 12 months, or by an average of 75,000 to 85,000 tons each month.

But a source at EDL told The Daily Star that this shipment could only allow the company to generate four to five hours of electricity each day, adding that Lebanon needed 3 million tons of fuel each year to return to the old power rationing.

He added that EDL’s power plants had an output of less than 800 MW compared to over 2,000 MW a year ago.

“The Iraqi General Directorate of Oil called for a virtual meeting to open the bids, to which representatives of the companies participating in the tender were invited, as well as Lebanon's General Directorate of Oil in the Energy and Water Ministry, the Finance Ministry, the Central Bank and the Iraqi Sumo Company,” the statement said.

It added that three international companies participated in the tender, out of four approved by the Iraqi side: Enoc, Independent Petroleum Group, and Coral Energy DMCC.





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