Business And Markets

CBI Governor in Baghdad

CBI Governor in Baghdad
CBI Governor in Baghdad

Central bank officials from Iran and Iraq met Wednesday in Baghdad to review issues related to the extended delays in the repayment of Iraqi government's debts.
Ali Salehabadi, governor of the Central Bank of Iran and his Iraqi counterpart Mustafa Ghaleb discussed ways to enhance cooperation between the two banks. No details were available, ILNA reported.
An estimated 20 million cubic meters of gas is exported to the Arab neighbor every day (worth at least $200 million per month). However, Iraq has not paid the bills and the debt keeps piling up.
Baghdad reportedly owes more than $6 billion in unpaid energy bills including $2 billion in arrears and $1 billion in contract violations. Three billion dollars are blocked by the Trade Bank of Iraq, due to the US economic blockade and banking restrictions.
Last month the National Iranian Gas Company said was ready to renew its gas export contract with Iraq, but added that it expects the Iraqis to settle its debts as soon as possible. The contract expires in February 2022.
Iraq's debt to Iran for electricity import is said to be in the region of $1 billion. The Arab country is the biggest importer of Iranian electricity for more than a decade. It needs 23,000 megawatts of electricity for spiraling domestic demand but decades of war, civil strife and terror attacks have destroyed its power infrastructure.
Iraq has a 7,000 MW power deficit and large parts of the country have for years struggled with systematic blackouts of several hours a day. The power shortages have often led to violent public protests.
A former CBI head said Iran managed to use about $2 billion of its frozen funds in Iraq and China for purchasing Covid-19 vaccines and agricultural products.

Iraq in Talks With Saudi Aramco

Iraq is in talks with Saudi Aramco for a gas deal and plans to sign billions of dollars’ worth of energy, power, water and petrochemical contracts with Saudi Arabia, the country's oil minister said, as OPEC's second-biggest producer seeks to woo more foreign investment.
Iraq is also intensifying talks with Saudi Arabia's ACWA Power to build water desalination, clean energy and solar power plants in the country, Ihsan Abdul-Jabbar Ismail said, news outlets said on Monday.
The Iraqi government plans to ink the contracts before the end of its tenure, he said. Parliamentary elections held on Oct. 10 will be followed by a new government formation.
Iraq's oil ministry has started a dialogue with "a global energy company" to conduct gas exploration in the western desert in Anbar province, the ministry said in an Oct. 5 statement, amid plans to wean itself off Iranian energy imports.
Ismail said in the statement he would name the company once an agreement is reached.
Iraq is under increasing pressure from the US to wean itself off electricity and gas imports from Iran, which has been subject to US sanctions since 2018. The US administration has been granting Iraq waivers since 2018 to continue importing Iranian energy.
Iraq has been seeking the help of international oil companies to capture associated gas. The majority of Iraq's gas output is pumped with oil and the associated gas is mostly flared. Iraq was the world's second-worst flaring nation after Russia in 2020, according to the World Bank.


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