Iraq signs gas supply contract with Iran

BAGHDAD, March 27, 2024 – The Iraqi government has signed a deal for the supply of up to 50 mcm (1.77 bcf) per day of gas from Iran, local media reported on Wednesday.

The gas will be directed to Iraq’s power generation and volumes will depend on its needs.

Iraq’s Iranian electricity and gas imports contribute between 33% and 40% of its power supply. As of mid-2023, Baghdad owed Tehran around EUR 11 billion for the supplies, prompting it to launch a programme of paying for them with crude.

The deal was signed by Iraqi Minister of Electricity Ziad Ali Fadhel and representatives of the National Iranian Gas Company.

It will “ensure the sustainability of the work of power plants and keep pace with the peak loads and the increasing demand for electric energy,” the Minister of Electricity was quoted as saying.

Iraq imports Iranian gas under US sanctions waivers, given with the understanding that the country will develop a domestic gas supply and eventually wean itself off Iranian volumes.

Photo courtesy of Iran’s Ministry of Petroleum.

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