Although Iraq is in talks with international firms, such as Baker Hughes, Total Energies, Halliburton and Aramco, to implement oil and gas development projects in the west of the country, its independence from Iran’s electricity and natural gas imports is unlikely in the foreseeable future, a member of the Oil, Gas and Petrochemical Products Exporters Union said.
“No matter how many foreign firms invest in the Arab neighbor, it will be in need of Iran’s electricity and gas resources in the years to come,” Hamid Hosseini was also quoted as saying by ILNA.
As Iraqi population and industries grow, the more power and gas it will need, and Iran is the best choice for meeting the rising demand, he added.
Hosseini noted that although Iraq is under increasing pressure from the US to wean itself off electricity and gas imports from Iran, removing Iran from Iraq’s market is highly improbable as not only is it more economical for Iraq to import goods and energy from Iran, but Iran has also proved to be a reliable business partner.
Iranian Energy Minister Ali Akbar Mehrabian said last year that Iran had signed a long-term strategic electricity contract with Iraq to provide its Arab neighbor with sustainable energy supplies.
“We pursue the development of energy diplomacy centered on electricity with neighbors to both solve their problems and create a stable flow of income and use the maximum capacity of our electricity network,” he added.
Self-Sufficiency
Referring to Iran's self-sufficiency in power plant construction knowhow, the minister said close to 2,000 megawatts of power plants have been built in Iraq by Iranian companies with Iraqi investment.
He added that knowledge-based companies from Iran's private sector are building 1,700 megawatts of power plants in the neighboring country.
Despite its large oil and gas reserves, Iraq relies on Iran for natural gas that generates as much as 45% of its 14,000 MW of daily electricity consumption.
The country also supplies another 1,000 megawatts directly, making itself an indispensable energy source for its Arab neighbor.
Iraq has secured special waivers from US sanctions to be able to import natural gas and electricity from its eastern neighbor.
The volume of gas exports to Iraq since the beginning of the current Iranian year [started March 2022] has increased by over 1.5 billion cubic meters compared with the same period of last year.
Iraq's electricity production has increased by 22% compared with that of the previous year.
However, as new power plants are set to be launched in Iraq in the coming months and they rely on natural gas as feedstock, the Arab country needs to increase its gas purchases from Iran.
