Iran works to stop Iraq-Saudi electrical grid connection

Iranian electricity and gas sales to Iraq represent a vital artery for the Iranian economy, which has been battered by US sanctions.
Thursday 04/06/2020
Electrical wiring reaching out to homes in Saadoun Street in the Iraqi capital Baghdad. (AFP)
Electrical wiring reaching out to homes in Saadoun Street in the Iraqi capital Baghdad. (AFP)

BAGHDAD--Iran is apparently taking new steps to stop any electricity agreements between Saudi Arabia and Iraq, with the aim of monopolising ties with Baghdad and expanding its influence in the country.

Iranian Energy Minister Reza Ardakianian and an accompanying delegation recently arrived in Baghdad to meet with senior Iraqi officials, including Prime Minister Mustafa Al-Kadhimi and President Barham Salih.

The Iranian delegation’s visit came after reports that Iraqi Finance Minister Ali Allawi had travelled to Saudi Arabia last month to discuss strengthening energy and economic cooperation between Baghdad and Riyadh

After receiving the Iranian official, Kadhimi said that “opportunities for cooperation in the energy field, especially electricity, and the development of bilateral relations and cooperation between Iraq and Iran were discussed.”

Kadhimi added that “Iraq is keen on establishing the best relations with its neighbours,” noting that the government’s basic priority is to “develop the scope of external cooperation and increase the exchange of experiences.”

Salih stressed “the necessity of joint coordination and the expansion of cooperation with Iran, especially in the electricity and water sectors, in order to achieve development and prosperity for the two neighbouring countries.”

Ardakanian reiterated during the meetings that Iran was “ready to expand cooperation with Iraq” and help bring about “an appropriate situation in the electricity sector.”

However, sources close to Kadhimi’s government downplayed the prime minister’s statements on cooperation with Iran, telling The Arab Weekly that they are not binding and that the government could still go in another direction.

Kadhimi is reportedly weighing ways in which to advance Iraq’s interests while moving away from an imbalanced relationship with Iran..

Iran, meanwhile, could offer competitive prices to prevent any Iraqi electricity deal with Riyadh, but Baghdad is aware that Tehran could use this to try and expand its security and political influence.

Well-informed sources said Kadhimi’s government is seriously considering establishing energy ties with Saudi Arabia, which could prevent Iraq from spending billions of dollars annually to purchase electricity and gas from Iran.

Iranian electricity and gas sales to Iraq represent a vital artery for the Iranian economy, which has been battered by US sanctions.

Iran’s recent moves in Baghdad coincide with the arrival of an American delegation to start negotiations with Iraq on the future of relations between Iraq and the United States.

Iraq relies on Iran for electricity imports but the cooperation between the two countries does not sit well with Washington, which has long encouraged Baghdad to diversify its partners in the field of energy to include Arab Gulf countries.

The United States extended Iraq’s sanction waiver on Iran for 120 days, allowing it to continue to import electricity from Tehran in a gesture of support to the new PM, but announced it would be the last exemption while Baghdad looks for new suppliers.

Despite the four-month reprieve— as Iraq faces soaring temperatures and increased energy use in the summer — there remains a lot to be resolved between Washington and Baghdad regarding Iran’s relationship with Iraq.

Iran provides Iraq with around 1,200 megawatts of electricity per day, and 40 million cubic metres of gas.

On December 9, Ardakanian said his country had signed a three-year cooperation agreement with Iraq for extending Iranian energy exports.

On November 9, Ardakanian announced that the power grids of Iran and Syria were to be connected through Iraq, after Tehran and Damascus signed a preliminary agreement on the issue.