MEED reported that Syria is in talks with Italy's Saipem for a proposed deal to build crude oil and natural gas pipelines linking Syria and Iraq.

As per report, Mr Mohammad Naji Otri PM of Syria met with Mr Pietro Franco Tali chairman of Saipem on May 24ht 2010 for talks on cooperation in the oil and gas sector.

Syria plans to build a pipeline, which would join Iraq's oil export infrastructure and would see crude oil transported from the southern oil fields of Basrah to the Syrian port of Baniyas. Damascus also plans to build a gas pipeline between the 2 countries.

The talks were also attended by the minister of petroleum and mineral resources Sufian Alao and Saipem's executive director Mr Pietro Varone. According to Middle East projects tracker, despite being involved in an estimated USD 118 billion worth of projects across the region's energy sector, the pipeline deal would be a first for the Italian engineering firm in Syria.

Syria has proven oil reserves of 2.5 billion barrels but production has been in steady decline over the last decade, falling from 576,000 barrels per day in 1998 to 398,000 barrels per day in 2008. UK energy consultants KBC forecast this figure will fall to around 305,000 barrels per day by 2020. State run Syrian Petroleum Company is responsible for less than half of the country's output. The rest is produced by JV companies.

The Arab Republic requires some 6 billion cubic meters a year of natural gas, a figure which is expected to rise to around 14 billion cubic meters by 2015. Domestic production stands at around 5 billion cubic meters per year, so much of this is expected to be imported, largely from Egypt the Arab Gas Pipeline through neighboring Jordan.

(Sourced from MEED)