Iraqi Oil Minister Jabar al-Luaibi recounted on Sunday that the deal is about swapping up to 60,000 barrels per day of crude produced from the northern Iraqi Kirkuk oilfield for Iranian, according to Reuters.
The agreement signed on Friday by the two OPEC member states provides for Iran to deliver to Iraq’s southern ports, on the PersianGulf, “oil of the same characteristics and in the same quantities” as those it would receive from Kirkuk.
“This is an agreement for one year and then we will see after that whether to renew it,” Luaibi told reporters in Kuwait City on the sidelines of an Arab oil ministerial meeting.
The deal in effect allows Iraq to resume sales of Kirkuk crude, which have been halted since Iraqi forces took back control of the fields from the pro-Barzani forces in October.
Between 30,000 and 60,000 bpd of Kirkuk crude will be delivered by tanker trucks to the border area of Kermanshah, where Iran has a refinery.
Luaibi also said that the construction of an oil pipeline from Kirkuk to the Turkish port of Ceyhan will take one year to build.
It will replace an old, badly damaged section of the Kirkuk-Ceyhan pipeline. It will start from the nearby city of Baiji and run to the Fish-Khabur border area with Turkey.
The territory that the Kirkuk-Ceyhan pipeline ran through was taken by ISIL terrorists in 2014 and then recaptured by Iraqi forces over the past two years.
Kirkuk is one of the biggest and oldest oilfields in the Middle East, still estimated to contain around 9 billion barrels of recoverable oil.