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Iran Providing Up To 30 Percent of Iraq’s Gas Needs

Source: www.gulfoilandgas.com 7/26/2013, Location: Asia

When recently signed gas contract between Iran and Iraq comes into effect Iran will be able to provide 65 to 70 percent of Baghdad and 30 to 35 percent of total Iraq’s gas needs, the National Iranian Gas Company’s (NIGC), managing director, Javad Oji said.

Speaking to Shana, Oji said last year Iran’s gas imports stood at 4 bcm while its exports hit 8 bcm adding the country now exports 35 to 37 mcm of gas per day that by execution of the new contract with Iraq will reach 55 to 60 mcm/d and will hit 75 to 80 mcm/d in the second phase of gas deals with Iraq implying rising total gas exports by more than 2.5 times.

He further said that pricing formula for gas export to Iraq is the same in Pakistan and Turkey gas agreements and could constitute a basis for selling gas to other Persian Gulf countries.

Referring to volatility of gas prices in world market, Oji said: during the recent meeting of Gas Exporting Countries Forum (GECF) in Moscow the members stressed on linking gas to oil prices, a subject that GECF’s secretary is studying it.

Elsewhere in his remarks, NIOC’s official said several gas contracts would be finalized in the near future stating gas contract with Iraq will facilitate concluding gas contracts with other countries in the Persian Gulf region.

NIOC chief said: diversification of gas export routes to Europe is the other advantage of Iran-Iraq contract which in addition to Turkey will open a second route for gas transfer to Europe, an issue that has been approved by Iraqi and Syrian governments. He continued: by gas transit through Iraq and Syria not only the two countries will earn transit revenues but it will boost Iran’s bargaining power in negotiations for gas export to Europe.

According to Oji, the country has spent 8.000 billion rials in building the 227 km gas pipeline to Iraq which will return just in the first month of gas exports to the neighboring country.

‘We will earn 350 million dollars each month through exportation of 25 million cubic meters of gas per day to Iraq, Oji said.

He noted that during the signing ceremony of the gas contract in Baghdad, Iraqi side asked Iranian contractors to take part in laying gas pipeline in the country, building Iraq’s gas network and stressed on necessity of finalizing the second gas contract as soon as possible.

South pars gas field will be the main source of providing Iraq’s gas needs. Iran is a secure source of providing gas for the next 100 years and with a large interconnected gas network is able to meet gas needs whether inside the country or to its foreign partners, Oji concluded.

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