Iraq's electricity ministry signed a $363 million power deal with Egypt's Orascom Construction to build a 1,014-megawatt gas power plant in northern Iraq, it said. The contract involves building a plant in Baiji, 180 km (112 miles) north of Baghdad, to install six gas units, each with a capacity of 169 MW, which Iraq bought from Siemens in 2008.
The project is expected to be completed within 21 months, officials have said.
Nearly nine years since the U.S.-led invasion that ousted Saddam Hussein, Iraq's national grid still supplies only a few hours of power each day. Intermittent electricity is one of the public's top complaints.
Iraq plans to boost the grid's capacity by about 1,500 megawatts in the next few months and to add 22,000 MW of production capacity across Iraq, except for the semi-autonomous region of Kurdistan, by the end of 2015, the electricity minister has said.
Iraq's power availability has ranged between 7,000-8,000 megawatts but is due to increase to 9,000-9,500 MW this summer as some power projects come online and others are upgraded.
Iraqi demand for electricity peaked at 15,000 megawatts last year, but the oil-producing nation managed to supply less than half of that.