Ministry of Oil Unveils Investment Projects to Boost Refining Sector and Economic Benefits
The Ministry of Oil announced today plans to enhance refining sector capabilities through investment projects in two provinces aimed at increasing production capacity, improving the quality of petroleum derivatives, and reducing reliance on imports. The ministry expects these projects to generate economic benefits of approximately $1.9 billion annually. The official spokesperson explained that this initiative seeks to develop refining industries and maximize the economic value of crude oil by expanding private sector participation, adopting modern technologies, transferring technology, and developing national workforce capabilities. Al-Burham Company for Refining and Distribution of Petroleum Derivatives is implementing two main projects in the provinces, aiming to increase production, improve fuel quality, and boost private sector contribution to the oil industry. The first project involves naphtha hydrogenation and gasoline improvement with a design capacity of 14,400 barrels per day under a Build-Own-Operate-Transfer (BOOT) scheme, with ownership transferring to the Northern Refineries Company after the contract period. The project targets producing high-quality gasoline with an octane rating of 92, as well as liquefied petroleum gas quantities ranging from 150 to 170 tons daily. Estimates indicate potential economic benefits of around $300 million annually, creating over two thousand direct and indirect jobs, alongside training Iraqi staff and transferring modern technologies. The second project, started in July 2025, involves expanding a refinery in another province as part of a five-year plan to increase refining capacities and enhance the production of high-quality petroleum derivatives. The project includes establishing a refining unit with a capacity of 70,000 barrels per day, a naphtha hydrogenation unit with 18,000 barrels per day, and a gasoline improvement unit with 10,000 barrels per day, plus an isomerization unit with 8,000 barrels per day capacity. Additionally, the project comprises a liquefied petroleum gas treatment unit with 180 tons per day capacity, a loading station for petroleum products with 90,000 barrels per day capacity, and industrial and service facilities including power generation stations, nitrogen production, water purification, industrial wastewater treatment, 24 tanks for crude oil and petroleum products, and a station for filling liquefied gas cylinders. The project's preliminary estimates suggest economic benefits and increased state revenues of about $1.6 billion annually through increased production of high-value derivatives, reduced import costs, and activation of related industrial and service sectors. On the social front, the company is undertaking an initiative to build a 100-bed hospital in the same province to support the health sector and enhance services provided to citizens. Al-Burham Group aims to expand cooperation with international companies specialized in refining technologies and oil industries to benefit from advanced technologies in hydrogenation, gasoline improvement, and raising the quality of petroleum derivatives, with a focus on deep conversion technologies to increase white derivatives production and maximize added value per barrel of crude oil. The group is also moving towards establishing Iraqi factories specialized in producing oil and engineering equipment according to global standards, reducing reliance on imports, accelerating project implementation, and supporting national industry. These investment projects are part of efforts to expand private sector participation in developing oil industries, enhance refining capabilities, improve product quality, and reduce import bills, thereby supporting the national economy and contributing to achieving self-sufficiency in petroleum derivatives.
