Last Updated: Sun May 27, 2012 17:01 pm (KSA) 14:01 pm (GMT)

UAE eyes June opening for pipeline bypassing Hormuz

The Habshan-Fujairah pipeline will carry oil from fields in Abu Dhabi on the Gulf to Fujairah on the Gulf of Oman. (File photo)
The Habshan-Fujairah pipeline will carry oil from fields in Abu Dhabi on the Gulf to Fujairah on the Gulf of Oman. (File photo)

A pipeline being built by the United Arab Emirates to pump most of its oil exports from east coast terminals bypassing the Iran-threatened Strait of Hormuz, will be operational in June, the ruler of Fujairah told AFP in an interview.

“The pipeline will be operational in June,” said Sheikh Hamad bin Mohammed Al-Sharqi, whose east-coast emirate is one of seven that make up the UAE.

Construction of the 360-kilometre (225-mile) pipeline began in 2008.

The pipeline will have an initial capacity of 1.5 million barrels per day rising to 1.8 million bpd, which represents the bulk of the UAE’s current production of around 2.5 million bpd, Sheikh Hamad said.

The Habshan-Fujairah pipeline will carry oil from fields in Abu Dhabi on the Gulf to Fujairah on the Gulf of Oman.

Fears of a closure of the Strait of Hormuz intensified in recent months after Iran threatened to close the strategic outlet to the Gulf if Western governments kept up their efforts to choke off its oil exports in a bid to rein in its controversial nuclear program.

In addition to the exports of the UAE and Iran itself, all the oil exports of Bahrain, Kuwait and Qatar are shipped through the waterway. Iraq also pumps the bulk of its exports through ports on the Gulf.

Saudi Arabia, the world’s largest oil exporter, pumps most of its crude from its terminals on the Gulf but it can divert large supplies to terminals on the Red Sea.

Sheikh Hamad, however, played down the possibility of a closure of Hormuz.

“I do not believe there will a war,” he said, arguing that the tension with neighboring Iran is just a “summer cloud that will clear.”

Iran held talks on Wednesday and Thursday in Baghdad with six world powers that nearly collapsed when the powers demanded that Tehran give up enriching uranium to the 20 percent level seen as a key step towards weapons-grade.

In exchange, Iran would get some inducements such as aircraft parts for its dilapidated commercial fleet and technical assistance in nuclear energy.

Iran, which is suffering under Western sanctions, said the inducements were far too little and countered with a demand that the P5+1 declare that it has a right to enrich uranium.

The two sides agreed to meet again in Moscow on June 18-19.

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