Basrah Oil Refinery Upgrade

The Basrah oil refinery, also known as the Shuaiba oil refinery, located in Basrah, Republic of Iraq is being upgraded with the installation of a new refining plant adjacent to the existing refinery facility.

It will increase the total processing capacity at the site from 210,000 barrels per day (bpd) to 280,000bpd.

The oil refinery upgrade project is being implemented by state-owned South Refineries Company (SRC), which is a part of Iraq’s Ministry of Oil.

The refinery expansion project is intended to increase the output of gasoline and other oil products in the existing refinery and reduce the country’s dependency on imported petrochemical products.

Scheduled for completion by 2025, the upgrade project will increase the refinery’s gasoline production capacity to 19,000 barrels per day (bpd) and diesel fuel production to 36,000bpd.

The project is expected to generate employment opportunities for up to 2,000 people.

Existing Basrah refinery details 

Built in the 1970s, the Basrah refinery is one of the major refineries in Iraq. It was commissioned in 1973 with a nominal processing capacity of 170,000bpd.

Owned and operated by South Refineries Company, the Basrah refinery’s current processing capacity stands at 210,000bpd.

Shaw Group was contracted to conduct a feasibility study for the rehabilitation of the Basrah refinery funded by the US Trade and Development Agency (USTDA) in December 2011.

Need for the Basrah refinery upgrade

The production capacity of the operational refineries in Iraq were damaged and deteriorated due to wars.

Although the Iraqi refineries produce adequate heavy fuel oil for domestic consumption needs, the production petroleum products such as gasoline and diesel are not sufficient. Therefore, the country relies on imports of some petroleum products.

The Basrah refinery upgrade is part of Iraq’s plans to expand refining capacity to address domestic petroleum product shortages and reduce oil product imports. The upgrade will also improve oil refinery efficiency at the existing plant.

Basrah refinery upgrade details

The upgrade at the Basrah refinery will mainly include the installation of a 34,500bpd fluid catalytic cracking unit (FCCU), a 55,000bpd vacuum distillation unit (VDU) and a 40,000bpd diesel desulphurisation unit (DDU).

The other processing units to be installed as part of the upgrade project include a visbreaking unit (VIS), a hydrotreating facility, a hydrogen plant, a sulphur recovery unit, a sour water stripper, an amine regeneration unit, an LPG oligomerisation unit, and a light gas oil hydrotreating unit.

New utility and off-site facilities 

The refinery upgrade will also involve the installation of three steam generators, a water treatment plant, a cooling water plant, instrument air generators, and nitrogen generators. It will also involve new power receiving and fuel gas facilities.

The upgrade will add various off-site storage facilities such as intermediate product storage tanks, water tanks, flare gas recovery units, waste water treatment plant, fire hydrant system, and connecting pipe system with the existing refinery.

Financing for the Basrah refinery upgrade

The Basrah refinery upgrade is being funded through Japanese Official Development Assistance (ODA) loans provided by the Japan International Cooperation Agency (JICA).

JICA signed a loan agreement of £800m ($1.01bn) with the Republic of Iraq for the Basrah refinery upgrade in June 2019.

Contractors involved Basrah refinery upgrade

JGC Corporation received a letter of award (LOA) for the engineering, procurement, construction, and commissioning (EPCC) of primary processing units including the FCCU, VDU and DDU for the Basrah refinery upgrade in August 2020. The lump sum contract value is estimated to be approximately £2.86bn ($3.74bn).

Technip and UNICO International were awarded a project management consultancy (PMC) contract by South Refineries Company for the Basra refinery upgrade in April 2015. The scope of the contract included the engineering, procurement, construction, commissioning, start-up and warranty management phase of the refinery upgrade project.

The Prokop Engineering and Techno Export team was contracted by South Refineries Company for the construction of the crude distillation unit and the LPG unit at the Basrah refinery.