Security Issues Overshadow Iraq Gas Import

Security Issues Overshadow Iraq Gas Import Security Issues Overshadow Iraq Gas Import

Iran is all set to commence gas export to Iraq on condition that the Iraqi side provides security in its territory, managing director of the National Iranian Gas Export Company told Shana.

"Security concerns have postponed Iran's gas delivery to Iraq," Alireza Kameli said, adding that gas export will not start unless Iraqi security forces guarantee the safety of the region where gas is due to be delivered. Not only is Iraq suffering from ethic clashes, but also Islamic State forces have made the region thoroughly insecure.

Underlining the fact that the war-ravaged neighbor is in dire need of electricity, the official reiterated although the US has set up many power plants in Iraq, they will not become operational as long as the much-needed feedstock is supplied by Iran. According to Kameli, three power plants are situated alongside Iran-Iraq gas pipeline, two of which are ready to receive gas through a pilot scheme.

Asked when exports might begin, he said, "That depends on the security situation in Iraq."

"As per contract terms, the two sides are exempted from paying any fines during the first year after signing the agreement."

Tehran and Baghdad signed a draft deal in 2013 to transfer Iran’s gas to two Iraqi power plants. There are plans to export 30-50 million cubic meters of gas per day to Iraq, the revenues from which are estimated at $4-6 billion. Gas will be exported from Naftshahr region in Kermanshah Province in the first phase, by diverging branches of the Sixth Iran National Gas Trunkline.

In March, Kameli said exports to Iraq could begin in May if security conditions improved. Iran first announced a delay in September last year, shortly after Islamic State militants took control of large swathes of Iraqi territory. Although exports were expected to commence by the end of May, Hamdireza Araqi, managing director of the National Iranian Gas Company, blamed technical and financial issues which seem to have been settled.