Iraq offers gas site concessions amid power generation issues

• 15 gas sites open to investors
• Electricity generation a priority
• Move to end gas flaring

Iraq is offering 15 natural gas concession sites to international investors as part of a post-conflict drive to develop its hydrocarbon resources and increase production capacity, the state-owned Iraq news agency reported.

Opec’s second largest oil producer is prioritising the development of its gas deposits to stop the long-standing practice of burning them off, or flaring, when it pumps up oil. It needs more gas to power its electricity generating stations.

“There are now 15 sites which we believe have promising gas deposits,” Oil Minister Hayan Abdel Ghani said this week, according to the news agency. 

“We have indications that large gas quantities exist in that area and we are willing to negotiate with any company wishing to invest in these sites.”

The sites are in western Iraq, the agency reported, without giving more details. 

In May, Iraq signed contracts for the development of 14 oil and gas concessions, with several awarded to Chinese companies.

Iraq’s Oil Ministry said last year that the concessions awarded to the Chinese and other international companies would boost the country’s oil output capacity by 675,000 barrels per day and add nearly 850 million cubic feet per day of gas to its production.

The ministry said that the Chinese companies awarded those projects include UEG, GEO-Jade, Zhenhua, Anton Oil, Sinopec and ZEPC, in addition to Iraq’s KAR Group, France’s TotalEnergies and a Ukrainian company.

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• Iraq to propose new plan to offset extra oil output 

Iraq controls the world’s fifth-largest recoverable oil deposits of around 145 billion barrels and nearly 3.5 trillion cubic metres of natural gas, the twelth largest.

Baghdad has intensified a campaign over the past two years to develop its gas fields to power its electricity facilities following a steady decline in Iranian gas supplies, which came to a standstill in December.

Prime Minister Mohammed Al-Sudani said earlier this year that Iraq would be able to do without Iranian gas by 2028 when most gas development projects are completed.

Until the covid 19 pandemic, Iraq has been in a near perpetual state of conflict or subject to United Nations sanctions since its invasion of neighbouring Iran in 1980.