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Improved Security Giving Hope to Tehran-Baghdad Gas Deal

Improved Security Giving Hope  to Tehran-Baghdad Gas DealImproved Security Giving Hope  to Tehran-Baghdad Gas Deal

The recent gains of the Iraqi Army against the self-styled Islamic State militants can propel the export of Iran's natural gas to the war-stricken Arab country after years of regional insecurity and delay, the chief executive of National Iranian Gas Export Company said.

"Technical infrastructures, the pipeline and other facilities for gas export to Iraq are ready … The two sides are technically prepared to start supplies," Alireza Kameli was quoted as saying by IRNA on Tuesday.

Iraqi forces recaptured the last district held by IS insurgents in the key city of Fallujah on Sunday, as a top Iraqi general said the battle is almost over after nearly five weeks of fighting.

"We are waiting for Iraq to voice readiness to receive Iran's gas," Kameli said.

The assault is part of a wider offensive by Iraqi forces against the militant group that seized swathes of territory in 2014 but is now being pushed back. The army is likely to now concentrate on launching an offensive against terrorist-controlled Mosul, the country’s second-largest city.

The Iraqi government is toiling to restore security and stability to a country that is grappling with economic woes and waves of protests against its dismal public services.

The country needs Iran's gas to feed three of its power plants—Rumaila, Shatt al-Basra and al-Najibiyah—to address a severe power shortage that deprives Iraqi citizens for hours of electricity to power air-conditioners in the country's sizzling summer.

Under the deal, Iran will supply 25 million cubic meters of gas per day to Iraq, but the volume can bump up to 35 mcm/d during the hot season under the six-year contract.

A 270-kilometer pipeline stretches from Charmaleh, a village located in the western province of Kermanshah in Iran, to Naft Shahr, a town bordering Iraq and then to power plants in Baghdad. A second route, with a capacity of 30 mcm/d, will pass through Basra.

In March 2015, Kameli speculated that exports to Iraq could begin in May, if security conditions improved.

Iran ranks first in the world in terms of natural gas reserves and third in terms of oil reserves, according to the latest statistics compiled by BP. It holds 17% of the world’s proven natural gas reserves.

Nonetheless, it is currently a relatively minor and strictly regional exporter of natural gas via pipelines to three neighboring countries—Turkey, Armenia and Azerbaijan.

Financialtribune.com