TotalEnergies to Invest in Two Pipelines Bypassing Strait of Hormuz
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TotalEnergies will invest in two major oil pipelines designed to bypass the Strait of Hormuz, CEO Patrick Pouyanné announced Monday at the ONS energy conference in Norway. The French energy major will back Abu Dhabi's expansion of its Fujairah export route and a planned pipeline carrying Iraqi crude through Syria to the Mediterranean. The company has not disclosed investment amounts or stakes in either project.
Key Facts
- TotalEnergies will invest in two pipelines bypassing the Strait of Hormuz, CEO Patrick Pouyanné announced Monday at the ONS conference in Norway.
- The UAE's existing Habshan-Fujairah pipeline can carry up to 1.8 million barrels per day from Abu Dhabi's oil fields to the Gulf of Oman.
- Abu Dhabi plans to roughly double its bypass capacity by next year.
- The proposed Iraq-Syria pipeline could cost around $15 billion and take at least four years to complete.
- Before the Iran war, roughly a fifth of global oil supply moved through Hormuz.
Investment Commitments
TotalEnergies CEO Patrick Pouyanné announced the commitments Monday at the ONS energy conference in Norway. The company has not disclosed how much it will invest or what stakes it will take in either project. Pouyanné said TotalEnergies will become partners in the pipeline moving from Baghdad to Syria and will also invest in doubling the Fujairah pipeline. Two months ago, Pouyanné called investment in alternative Gulf export routes an “absolute priority” following the paralysis of Hormuz during the Iran war.
Pipeline Projects
The UAE's existing Habshan-Fujairah pipeline can carry up to 1.8 million barrels per day from Abu Dhabi's oil fields to the Gulf of Oman, bypassing Hormuz. Abu Dhabi plans to roughly double its bypass capacity by next year as the Iran war exposes the limits of the existing system. TotalEnergies is also proposing an Iraq-Syria pipeline that would give Baghdad a Mediterranean export route for crude currently leaving predominantly through its southern Persian Gulf terminals. The Iraq-Syria project could cost around $15 billion and take at least four years to complete, according to recent estimates.
Market Context
Before the war, roughly a fifth of global oil supply moved through Hormuz. Six months of severely disrupted tanker traffic have now spurred project development into overdrive. Pouyanné said TotalEnergies is today probably the largest trader of oil from Iraq or Qatar and that he needs to put equity into an alternative route.
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TotalEnergies to Invest in Two Pipelines Bypassing Strait of Hormuz
