An agreement between Syria and Iraq to revive the Haditha-Baniyas oil pipeline, formerly known as the Kirkuk-Baniyas pipeline, has prompted discussion about Syria’s future role in the regional energy sector. The debate centers on whether the project could become more than an oil transit route by attracting investment and economic partnerships, and on the potential gains for Syria’s economy from restoring this vital corridor.
On July 18, the Syrian Ministry of Energy announced the signing of two memoranda of understanding to revive the Iraqi-Syrian pipeline project during meetings held in the United States.
The Syrian Petroleum Company signed the first memorandum with the Basra Oil Company to rehabilitate and revive the Haditha-Baniyas pipeline between Iraq and Syria. The agreement seeks to restore a vital corridor for transporting Iraqi oil to Syrian export ports on the Mediterranean, strengthen Syrian-Iraqi cooperation in the energy sector, develop infrastructure connected to the project, and create new opportunities for economic and investment integration between the two countries.
The Syrian Petroleum Company also signed a second memorandum with an international consortium comprising Chevron, UCC Holding and TI Capital. The agreement calls for beginning the technical and financial studies required for the project and developing plans and implementation frameworks to rehabilitate the pipeline and its associated facilities in accordance with approved technical standards, ahead of moving to the implementation stages.
According to the Syrian Ministry of Energy, the project is among the region’s most significant strategic infrastructure projects. Rehabilitation work aims to bring the pipeline’s operating capacity to an estimated two million barrels of crude oil per day.
Economist Mulham al-Jazmati told Enab Baladi that restarting the pipeline would restore one of Iraq’s oil export routes to the Mediterranean, providing the country with an additional outlet away from the Gulf and increasing the flexibility of its exports.
For Syria, the immediate benefit would be the return of economic activity associated with transportation and energy, whether through transit fees, infrastructure operations, or the creation of jobs in maintenance and logistics.
However, al-Jazmati said the project’s effect on the Syrian economy would not be immediate. Restarting the pipeline would represent an initial step toward gradually reintegrating Syria into regional energy networks and could later open the door to larger investments in the sector.
Syria as an Energy Corridor
The project’s importance is not measured solely by the resumption of oil flows through Syrian territory. It also depends on Syria’s ability to turn that transit activity into broader economic value by generating direct and indirect revenue and using its geographic location to develop its role in the energy sector.
Al-Jazmati explained that Syria’s role at the current stage would be closer to that of an energy corridor than an energy hub. An energy hub requires an integrated system that includes storage, refining, redistribution and logistics, rather than merely allowing resources to pass through the country.
He added that restarting the pipeline would restore part of the transit role Syria lost in recent years, but would not automatically make it a regional energy hub. Achieving that objective would require developing refineries, storage facilities, ports and logistics services.
Regarding economic returns, al-Jazmati said the project’s value would not be limited to transit fees, although these would be one source of direct revenue.
Transit fees are generally calculated through bilateral agreements that take into account the volume of oil transported, the length of the pipeline within the country’s territory, and operating, maintenance and investment costs.
Al-Jazmati said indirect returns could prove more important over the long term. These could include revitalizing ports, increasing demand for transportation and storage services, supporting local companies and creating jobs.
In other words, he explained, the project’s real economic value would not lie solely in the fee the state collects for each barrel, but also in the economic activity generated by the pipeline’s operation.
Project Success Depends on Overcoming Challenges
Al-Jazmati said the project’s success depends on overcoming several challenges, most notably rehabilitating the pipeline’s infrastructure after years of inactivity and ensuring that it meets modern technical standards. The project also requires a stable regulatory environment, clear operating and maintenance mechanisms, improvements to ports and logistics services, and connections to domestic transportation networks.
He also stressed that political and security stability would be essential to the project’s sustainability. Pipelines are long-term investments, and companies assess not only technical considerations but also the risks surrounding them.
Regarding competition with other oil export routes, al-Jazmati said the pipeline would not directly compete with the Gulf export network, which has extensive infrastructure and major international ports. Instead, its main competitors would be other routes used to transport Iraqi oil, including the port of Basra through the Gulf, the Turkish Kirkuk-Ceyhan pipeline, and future projects connecting Iraq with ports on the Gulf or the Red Sea.
He added that the pipeline’s importance would not be based solely on its commercial cost. It would also give Iraq greater diversity in its export outlets and reduce its dependence on a single route, an increasingly important consideration amid geopolitical tensions affecting global energy supply routes.
Haditha-Baniyas Replaces Kirkuk-Baniyas
The adoption of the Haditha-Baniyas route instead of the historic Kirkuk-Baniyas route is one of the changes accompanying the project.
Al-Jazmati said the change would not significantly alter Syria’s economic role because the project’s importance for Syria is tied to the passage of oil through its territory to the port of Baniyas, regardless of where the pipeline begins inside Iraq.
For Iraq, choosing Haditha may be more closely connected to increasing the flexibility of its oil network, linking different production areas and reducing reliance on a single route. The choice could also make it easier to manage oil flows and protect the pipeline, depending on the project’s final design.
The history of the oil pipeline between Iraq and Syria dates to 1952, when a route began transporting Iraqi crude oil from the Kirkuk fields through Syrian territory to the Mediterranean port of Baniyas.
The pipeline stopped operating several times for political and security reasons before being taken out of service after sections of it sustained severe damage during the 2003 Iraq War.
Exporting Iraqi Oil Through Syria
Iraq has announced plans to continue exporting crude oil and naphtha, a light liquid petroleum product extracted during crude oil refining, through Syria.
A Syrian Ministry of Energy official told Reuters on June 19 that Syria intended to open two additional oil unloading zones and other facilities in Baniyas to handle Iraqi crude oil and naphtha.
Mohammad al-Ahdab, director of the Media Department at the Syrian Petroleum Company, told the agency that Baniyas can currently unload an average of 900 trucks per day.
Two Iraqi oil sector officials said plans to diversify crude oil and fuel export routes, including exports through Syria, would continue even after the war against Iran ends and shipping through the strait returns to normal. The plans are part of a government-approved strategy to reduce Iraq’s dependence on a single export corridor.
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