Tehran, Baghdad Planning 2nd Gas Contract

Source: Iran Daily 6/16/2014, Location: Middle East

Iran and Iraq plan to draw up another contract on transferring Iranian gas to Iraqi power plants, said an energy official in Tehran.

"Iran's second gas export route to Iraq will lead to Basra power plant, but no contract in this regard has been signed yet," Managing Director of National Iranian Gas Company ( NIGC ) Hamid Reza Araqi told Tasnim News Agency.

Back in July 2013, Iranian and Iraqi oil ministers signed the first deal to transfer natural gas from Iran to Iraq. The project is aimed at supplying Al-Baghdad and Al-Mansouriyah power plants with 25 million cubic meters (mcm) of natural gas per day.

Araqi emphasized that there is a possibility that another pipeline would be constructed to export Iran's gas to Basra power plant.

He said the first agreement with Iraq on exporting gas to the country's power plants will be implemented this Iranian year (started March 21).

"Currently, the construction phases of the project to transfer Iran's gas to Iraq are underway across the two sides of the border, and efforts are being made to complete the pipeline and coordinate power plants in Iraq," he said.

The NIGC chief also said Iraq's three power plants of Al-Baghdad, Al-Sadr and Al-Mansouriyah will produce 2,500 megawatts of electricity following the implementation of the first contract.

Araqi had previously said Iran will transfer gas to Iraq before winter to let the Iraqi power plants prepare for a continuous flow of natural gas in the spring of next year.

His comments came after Deputy Oil Minister for International and Commercial Affairs Ali Majedi announced in May that under a finalized deal, Iran's gas exports to Iraq will start by March 2015.

The construction work on Iran-Iraq gas pipeline will be completed in the next Iranian year (to start March 21, 2015), announced a senior energy official.

Managing Director of Iran Gas Engineering and Development Company Alireza Gharibi added that Iran will then start exporting seven million cubic meters of natural gas to Iraq daily.

Gharibi stressed that the figure could be increased after the completion of Iran's sixth gas pipeline to Iraq. "Tehran and Baghdad have recently agreed to export 40 million cubic meters of Iranian gas to neighboring Iraq," he said.

Construction work on the gas pipeline shows an 80-percent progress. Iran-Iraq gas pipeline originating from Asalouyeh near the massive offshore South Pars Gas Field in southern Iran will continue into Iraq to feed three power plants in the southern Iraqi province of Basra.

The pipeline is designed in a way that it will also be able to deliver gas to other Muslim countries like Jordan, Syria and Lebanon in future.

Iran, which sits on the world's second largest natural gas reserves after Russia, is making efforts to raise gas output by attracting more foreign and domestic investments, especially in South Pars Gas Field.


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