RIYADH: Once a lifeline for Saudi oil, the Trans-Arabian Pipeline is now the Kingdom’s first industrial heritage site. But with chokepoint risks rising, could a modernized Tapline make commercial sense again?
The Tapline, which began pumping in 1950, stretched 1,664 km from Saudi Arabia’s Eastern Province to the Lebanese port of Sidon, at one point carrying roughly 30 percent of the Kingdom’s oil output. It bypassed the Suez Canal and offered a direct overland route to European markets.
Today, with the Strait of Hormuz under persistent threat and Red Sea shipping increasingly exposed, the strategic logic behind such a route is resurfacing.
The resilience case
According to a 2014 study by Asher Kaufman, professor of history and peace studies at the US-based University of Notre Dame, the pipeline’s construction was an astonishing feat: 16,000 local workers, 265,000 tonnes of steel plate, and a purpose‑built access road that became a transport backbone. By 1950, the first tanker was loaded at Al-Zahrani, Sidon in Lebanon.
By the mid-1970s, supertankers and the reopening of the Suez Canal had made maritime transport more competitive. The Lebanese Civil War and later the Gulf War accelerated its demise, and operations ceased in 1990.
In July 2019, Saudi Arabia’s Ministry of Culture launched the Kingdom’s first industrial heritage competition. Shortly after, the Heritage Commission registered Tapline as the first official industrial heritage site in the Kingdom.
As Aramco’s history of the project recounts, Tapline was more than just an artery for oil. “The Tapline forever changed Saudi Arabia’s northern region, bringing facilities and prosperity along its route,” it read.
The pipeline’s relevance is not merely historical. Back in 2005, Jordan’s then-Energy Minister Azmi Khreizat confirmed that Amman had considered the rehabilitation of the Trans-Arabian Pipeline as a strategic option to address the country’s acute need for oil resources.
Amid the 2022 energy crisis, when supply disruptions pushed European buyers to seek alternatives to seaborne energy routes, the pipeline was once again mooted as a possible solution.
Transit economics and the obstacles
Any revival would face a more complex transit landscape than in the past. A pipeline from Saudi Arabia to the Mediterranean would need to cross multiple states, each requiring stable, long-term agreements resilient to political shifts.
Jassem Ajaka, economist and university professor, argued that in today’s environment, “the presence of such infrastructure is not just about transporting oil but also serves as a form of geopolitical hedging for the countries it passes through, creating a kind of network of mutual interests.”
On the economic justification for such a project, Ajaka said that as a result of the Strait of Hormuz crisis and the elevated cost of insurance, maritime transportation is no longer the best or cheapest option to export oil.
He noted that “insurance prices surged by more than 400 percent during the first 48 hours of the war, forcing ships that attempted to pass through the alternative maritime route — the South African Cape of Good Hope — to pay up to $15 per barrel for insurance alone, a substantial cost compared to the price of a barrel.”
Under stable security, reviving the Tapline could deliver oil to Lebanon for just $3 per barrel, beating maritime shipping if insurance and transit fees stay under $5-$7.
But even if the Strait of Hormuz crisis ends, maritime insurance may remain high — $15 per barrel with oil at $70 would still make sea transport far costlier than pipelines. Still, he doubted maritime shipping beneficiaries would support such pipeline development.
Energy policy expert, and Middle East and North Africa director of the Natural Resource Governance Institute, Laury Haytayan offered a more cautious view, emphasizing that viability depends on whether such a route can compete with existing export flows to Asia, which remain Saudi Arabia’s primary market.
“Timing is also important because it affects transportation costs, which in turn determine how competitive the project will be,” she explained, adding: “At the same time, you need to consider where your existing infrastructure — such as production fields — is located, and whether additional infrastructure is required, since that would increase your overall costs.” Haytayan continued: “When you weigh all these factors together, along with current risks like congestion at key choke points, you can ultimately determine whether a new project makes sense.”
Lebanon-Israel peace deal
The pipeline’s original terminus in Sidon now sits within one of the region’s most complex geopolitical fault lines. Lebanon and Israel remain formal adversaries, complicating any revival along the historic route.
Ajaka said any lasting Lebanon-Israel deal would automatically de-risk a Tapline-like project, removing the need for expensive government guarantees and making financing easier.
Geographically, reviving the Tapline would give the Mediterranean basin a geopolitical edge by channeling Gulf oil through it, boosting the economies of involved states.
Regarding a Lebanon-Israel peace agreement, Haytayan said energy could be on the table in the negotiations but she questioned whether a revived Tapline would be a priority even under such conditions, noting that Gulf energy flows are still primarily oriented toward Asia.
She suggested alternative roles for Lebanon, such as storage or processing infrastructure, may be more realistic.
FASTFACTS
• Under stable security, reviving the Tapline could deliver oil to Lebanon for just $3 per barrel, beating maritime shipping if insurance and transit fees stay under $5-$7.
• But even if the Strait of Hormuz crisis ends, maritime insurance may remain high — $15 per barrel with oil at $70 would still make sea transport far costlier than pipelines.
“Would they (the Saudis) think of Lebanon as a location for a refinery project for by-products? Yes, that could be an interesting project for Lebanon. Would they also think of Lebanon as a storage place, so that they could have storage outside the Hormuz region? Because that’s important as well. Maybe these could be interesting projects to think about,” Haytayan explained.
Prof. Kaufman also remained skeptical, arguing that regional instability makes it difficult to justify long-term investment in infrastructure dependent on multiple transit states.
“Pipelines that cross different states are a risky matter for investors. The Middle East is not showing any signs of political stability. Given that, it’s hard for me to imagine a scenario where oil and gas producing countries would take the risk of reliance on multiple countries to export their oil and gas,” he added.
Legal structures
Attorney Jihad Chidiac told Arab News a modern, investable Tapline must balance state sovereignty with commercial viability, using a special purpose vehicle where states contribute land rights and approvals, while private partners provide capital and expertise, backed by sovereign agreements, multilateral guarantees, and political risk insurance.
“Governments typically seek to retain control over critical infrastructure, while investors require predictable revenues, enforceable contracts, and protection from political risk. As a result, modern ‘Tapline-style’ projects are usually structured through a combination of ownership, revenue guarantees, and risk mitigation instruments rather than a single legal form,” he explained.
For a pipeline crossing a potential Israel-Lebanon border after a peace deal, he noted it would require a stack of coordinated treaties.
When asked which structure best ensures oil flow even during war, he said BITs with stabilization clauses offer the strongest legal protection but only provide compensation after the fact, not physical enforcement.
Ultimately, a revived Tapline would only be investable as an SPV-backed project with anchor agreements, arbitration clauses, and political risk insurance, since no treaty can override active conflict or force majeure.
