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UAE plans leak tests for strategic oil pipeline in late April

Published:

The United Arab Emirates should know within weeks if its strategic oil pipeline for bypassing the Strait of Hormuz leaks after tests planned for late April, industry sources told Reuters.

The 1.5 million barrel per day (bpd) pipeline should offer the UAE an alternative route to exporting by ship out of the narrow strait which Iran has threatened to block as western pressure to limit its oil revenues has intensified.

The project already faces lengthy delays over a quality dispute with the Chinese company that built it and the UAE’s oil escape route could be blocked for much longer.

“The commissioning of the pipeline will not take place any time before December and there may be further delays if there are leaks during the water test which will take place by the last week of April,” said a UAE-based industry source directly involved in the project.

During the testing phase, water mixed with colored dye will be pumped into the 370-km (231-mile) Abu Dhabi Crude Oil Pipeline buried in the desert.

“Once it’s been checked for leaks and pressure, the pipeline will be dried and filled with nitrogen then about four months later the pipe can be filled with oil,” said another UAE engineering source.

The pipeline links the Habshan oilfields to the port of Fujairah - an increasingly important oil storage terminal outside the Strait of Hormuz on the Gulf of Oman.

Once any leak is found and fixed the commissioning phase can finally begin. This stage may require a small and temporary increase in oil production to keep UAE exports steady as the Abu Dhabi National Oil Company’s onshore unit ADCO pumps oil into the pipeline until it is full.

“The pipe will be filled with about one million barrels then will go up to 1.5 (million barrels) gradually,” the engineering source said.

“ADCO now needs to come up with a plan to store oil from the current production for the commissioning phase,” he said.

The UAE’s current output is around 2.6 million bpd and has a production capacity of around 2.7 million bpd.

“So roughly ADNOC needs to store around 40,000 barrels for a month so it could be used for (commissioning) the pipeline,” the industry source close to the project said.

The oil flowing through the pipe from Abu Dhabi will be mainly exported by ship but a portion will be used by a refinery at Fujairah.
Other companies working on the project are the International Petroleum Investment Company, owned by the Abu Dhabi government, and China Petroleum Engineering & Construction Corporation.