Oil rich Iraq and Jordan, which has one of the smallest economies in the Arab world, have agreed to go ahead with plans for the construction of an US$18bn pipeline that will export oil from the southern city of Basra to the kingdom's port city of Aqaba, Jordan Times reported.
The pipeline will export oil from Basra, which pumps about 2.3m barrels per day, or about 70 percent of Iraq’s total oil production, the newspaper reported, citing Basra Governor Khalaf Al Khalaf.
Basra's will reach 17m barrels per day by 2017 and the pipeline is "crucial" for its exports, Khalaf said.
The pipeline will create about 10,000 jobs and help Jordan, which has scarce natural resources and imports more than 90 percent of all its energy needs (the daily equivalent of 100,000 barrels of a oil a day) to be more independent and generate US$3bn a year in revenues, Khalaf said.
The kingdom until recently was dependent on Egypt for its gas supply, which has caused its public debt to soar.
Energy imports in the kingdom increased to 19 percent of GDP in 2011 from 9 percent in 2003 on the back of higher imports for generating electricity.
The two countries are expected set up the framework for the biding process, the newspaper reported, citing Jordanian and Iraqi officials attending the Basra Investment Conference.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.