UAE launches pipeline bypassing Strait of Hormuz
16 July 2012
The United Arab Emirates (UAE) has inaugurated a new overland oil pipeline bypassing the Strait of Hormuz, a narrow vital oil-trade passage that Iran has often threatened to shut down, where nearly one fifth of the world's traded oil passes.
The importance of this vital trade route where Iran has the capability of not allowing even a single drop of oil to pass, had been highlighted by former US secretary of state Cyrus Vance, who had called it ''the jugular vein of the West.''
UAE minister of energy Mohammed bin Dhaen Al Hamili and top executives from western oil majors like ExxonMobil, Shell and Total gathered yesterday to inaugurate the 1.8 million-barrel-per day Abu Dhabi crude oil pipeline linking oil fields in the UAE's western desert to the port of Fujairah and then onwards to a refinery in Pakistan.
The 370-km pipeline built at a cost of $4.2 billion project pipeline has taken four years to complete after several delays.
State-run International Petroleum Investment Company (IPIC) yesterday said that the pipeline has become operational and the first shipment was loaded onto a tanker for export.
UAE, OPEC's third biggest exporter, which exports a majority of its oil to Asia, said that the pipeline will take care up to 75 per cent of its exports.
"This is a very strategic project, it gives the options to our clients to transport larger quantities of oil," said UAE's oil minister Mohammed bin Dhaen al-Hamli.
"500,000 barrels of oil were pumped for around 400 kms through the new link from Abu Dhabi to the port of Fujairah and then taken to a refinery in Pakistan," said Khadem Abdullah Al- Qubaisi, managing director of IPIC.