Iraq says has contingency plans in case Iran gas imports halted

Iraq oil minister assures international oil companies that oilfields in the country were safe and secure amid increased US-Iran tensions.
Thursday 16/05/2019
Iraqi Oil Minister Thamer Ghadhban speaks to the media at the ministry's headquarters in Baghdad, May 8. (Reuters)
Iraqi Oil Minister Thamer Ghadhban speaks to the media at the ministry's headquarters in Baghdad, May 8. (Reuters)

BAGHDAD – Iraq has contingency plans for any stoppage to Iranian gas imports for its power grid but hopes no such disruption will take place, Oil Minister Thamer Ghadhban said on Thursday.

He said the next meeting of OPEC’s ministerial monitoring committee in Saudi Arabia would assess member states’ commitment to a current production reduction and that current oil prices and markets were stable.

Turkey has asked Iraq to purchase more of its crude, Ghadhban added, speaking to journalists in Baghdad.

He said international oil companies were operating as normal and assured them that oilfields in the south and north of the country were safe and secure amid increased regional tensions between the United States and Iran. 

A Chinese energy company was awarded a contract to recover natural gas from Iraq’s Halfaya oil field, on May 8, to fuel power stations in the country’s underserved Maysan province.

The China Petroleum Engineering and Construction Corporation said its gas processing plant would be able to recover and refine 300 million standard cubic feet of gas daily.

For decades, Iraqi oilfields have burned off the hydrocarbon byproducts of crude oil drilling instead of capturing them for energy production. Now, Iraq says it wants to recover natural gas to generate electricity and address the power shortages that plague the country.

The push into gas recovery comes amid diplomatic pressure by the United States to have Iraq halt its gas and electricity imports from Iran. The US applied sanctions against Iran’s energy and financial sectors last year.

The Halfaya oilfield is operated by PetroChina. CPECC says its gas plant will be operational in 30 months. Representatives from CPECC, PetroChina, and the Ministry of Oil signed an agreement in Baghdad on May 8.

Iraq produces approximately 1 billion cubic feet of gas daily, according to the US Energy Information Administration. The country is planning, or has already initiated, projects to recover another 1.85 billion cubic feet of gas daily, said Ghadhban.

(AW and agencies)