Complaints have emerged from a number of key buyers regarding the quality of one of Iraq’s most popular brands, as the country rushes to increase its production levels.
Two Chinese oil companies have complained about high water content in recent deliveries of Basra Light grade crude.
Most refineries can process oil with a water content of up to 0.1%. However, recent deliveries of Basra Light to Chinese refineries have contained between 0.3% and 1.0% water.
“Normally you should have a monitoring system in place. As production levels rise, this is not always the case. This water is going to impact on the pipelines, the pumping systems and all off the infrastructure. Also the buyer will feel cheated, because they will be buying water for the same price as oil. It hurts the consumer and the producer,” an industry expert who asked not to be named said.
So far the Iraqi government has been unable to provide an explanation as to why the water level in the reported export batch was so high.
“High levels of water make the oil very viscous and this takes a serious toll on your pumping system. It can be very damaging to the infrastructure,” the source said.
Iraq plans to increase production of its Basra Light brand by as much as 30% in 2014.
Asia represents a key consumer market for Iraq, with Chinese and Indian companies agreeing to buy 60% of all the Basra Light produced by Iraq this year.
