Iraq reduces by 75% its imports of Iranian gas and electricity

Iraq’s decision to stop relying on Iranian electricity and gas supplies seems surprising in light of the divisions among political parties and loyalty of many of them to Tehran.
Sunday 26/04/2020
Gas flare burning in the Zubair-1 storage zone of the Zubair oil field, located around 20km (miles) southwest of Basra in southern Iraq. (AFP)
Deadline. Gas flare burning in the Zubair-1 storage zone of the Zubair oil field, located around 20km (miles) southwest of Basra in southern Iraq. (AFP)

BAGHDAD–In a major surprise move, the Iraqi Ministry of Electricity revealed that it had reducedi ts imports of electricity and natural gas from Iran by 75% and that it was approaching the goal of self-sufficiency in generating electric power.

Analysts say this move indicates that Baghdad may have been told by Washington that the US will soon be revoking the waiver extended to Iraq from the US sanctions imposed on Iran.

The US administration has been automatically renewing every three months the waiver granted to Iraq from the sanctions imposed on Iran two years ago. The last waiver ran out on March 31 and was extended by one month only.

The ministry’s spokesperson, Ahmed al-Abadi, said that “the electricity produced by the country’s power plants is sufficient to cover the local needs continuously, except for Salahuddin and Nineveh provinces, where electric power is available at the rate of 20 hours per day.”

Abadi was quoted in a report published by the government newspaper Al-Sabah on Monday as saying that “the increase in the supply is due to lower loads and the operation of new generating units, in addition to clement temperatures.”

“The current volume of electricity production in Iraq is estimated at 13400 megawatts, and based on this data, the Ministry of Electricity has deliberately reduced the volume of electricity imported via land lines from the Iranian side, as well as the import of gas used to power the generating plants,” he added.

He pointed out that the Iranian side was providing Iraq with approximately 4500 GW of energy through a mixture of direct electricity supplies with a capacity of 1200 MW and gas to power production plants that contribute approximately 3 300 MW to the electricity grid.

He explained that the Ministry of Electricity is currently holding on to one supply line from Iran to supply about 350 MW of electricity to Diyala Province. The ministry used to import up to 1200 MW from Iran through four supply lines.

Abadi also revealed that the ministry has considerably reduced its imports of Iranian natural gas and that it has stopped the supply of Iranian gas to the power plants in southern Iraq. One gas pipeline from Iran used to supply the power plants at Bassamia, Mansourieh, Al-Quds and Al-Sadr. The Iraqi Ministry of Oil is now in charge of providing the needed supply of gas.

Iraq’s decision to stop relying on Iranian electricity and gas supplies seems surprising in light of the reigning divisions among the political parties and the loyalty of many of them to Tehran.

Iraqi Oil Minister Thamer Al-Ghadban revealed last week that the Ministry of Oil is close to adding about a billion standard cubic feet of associated gas per day to the national production.

International reports have revealed that Iraq imports natural gas from Iran at prices way above the prices of the international market, and this despite the fact that Baghdad had doubled its investments to use associated gas and even exported a good part of it.

Ghadban said that “the Ministry of Oil is committed to the optimal use of the gas associated with oil production in order to cover the local need, including supplying electricity power plants, and to stopping the import of energy from abroad.” He pointed out that the ministry had signed two major contracts to harness 750 million standard cubic feet of associated gas from the oil fields of Halfaya in the provinces of Maysan and Artawi in the province of Basra last year.

“The ministry signed another contract, just before the formation of the current government, for harnessing gas in the fields of Al-Gharraf and Al-Nasiriyah in Dhi Qar Governorate, at a capacity of 200 million standard cubic feet,” the minister added.

He explained that “these contracts represent an important step towards increasing production rates in the gas sector in Iraq in order to reach the set-goal of producing approximately one billion cubic feet of gas per day which will supply power plants and all industries related to gas uses.”

The minister stressed that the government and the Ministry of Oil are seriously committed to achieving self-sufficiency in gas and dispensing with its import. The ministry is currently working on developing the extraction of free gas in the Akkas field in Anbar and Mansourieh in Diyala, which would shore up the country’s gas production capabilities.

Baghdad had previously insisted that it still badly needed Iranian gas supplies to feed its electricity sector, especially in the summer when temperatures soar to more than 50C. Just this past April 14, Ghadban had ruled out stopping gas imports from Iran to supply Iraqi electricity power plants.

With the deadline of the American waiver running out at the end of the month, and as it nears the summer season when electricity consumption soars, Iraq will be facing a tough test if Washington requires it to commit to observing US sanctions on Iran.

The Iraqi government does not provide accurate annual estimates of the volumes of electricity and gas it imports from Iran, which confirms that the matter is less related to Baghdad’s need and more dependent on Tehran’s ability to provide what is required.