Aseem Jihad, official spokesperson of the Iraqi oil ministry, announced that the licensing contracts with international oil companies bound them to formulate systems to invest in associated petroleum gas. He also stressed on the point that Iraq has what it takes to be on the list of countries exporting natural gas by 2019. “Iraq has developed an agreement with companies to start gas collection systems and pump it to the sites of consumption,” he said.
“Iraq has actually started to invest in the gas associated with the extraction of crude oil,” said Jihad, citing contracts signed with “Mitsubishi and Shell companies, which will invest in gas in the Rumaila field in southern Iraq.”
He added, “During the next three years, Iraq will be able to benefit from the production quantities, which will add up to 2 billion cubic feet in the fields of Rumaila alone.”
He also said, “By 2019, Iraq would have reached the stage of self-sufficiency and then will be able to export gas.” Regarding the gas pipeline project between Iran, Iraq and Syria and then Europe through Turkey, he said, “This project is ongoing, given its strategic importance.” Iran officially announced the implementation of its contract with Iraq, which will see it providing Iraq with natural gas for three years. The Iranian Gas Engineering and Development Co. expected that the new exports, which range between 5 and 10 million cubic meters a day, would yield revenues worth $3.7 billion.
Ali Reza Ghoraibi, the managing director of the company, said, “After the completion of the first phase of the project, Iran will be able to export 5 million cubic meters of natural gas to Iraq per day. The exports may reach 10 million cubic meters a day in coming phases.” He said 75% of the project of extending a gas pipeline from Iran to Iraq is complete.
Iraqi Minister of Electricity Abdul Karim Aftan cited the importance of this contract, which he says will “provide natural gas to operate the gas station of Mansouria in Diyala province and the stations of Quds and Sadr in Baghdad. This quantity will be enough to generate 2,500 megawatts of energy.” Aftan said, “Iraq will lose 30% of the produced energy because gas units are operating on alternative fuel: fuel oil and black oil. With the implementation of this contract, 30% of this energy will be added to the total [production] capacity.” Iran currently produces 600 million cubic meters of gas per day, of which 37 million is exported. When the South Pars oil field is fully exploited, the production will reach 1.2 billion cubic meters.
Hamza Jawahiri, a governmental oil expert, said, “The investment process of associated petroleum gas is difficult and complicated. Before equipping the consumption locations, there are a number of phases [carried out] to purify the gas from other elements, such as water, sulfur and other acidic substances.” He said, “The construction of gas processing plants must come in tandem with [setting up] extraction plants. Gas cannot be transported through pipelines before being processed, since it contains acidic substances that can destroy any metal used in the construction of pipelines.”
Jawihiri announced the launching of the investment process of associated gas in some oil wells locations in the south. “We agreed with oil companies to give them a share of the produced gas in exchange for their services. This is lucrative for Iraq, since the associated gas is [usually] burned.” Talking about Iran’s attempt to sell the gas to European markets, Jawihiri said, “Europe relies on four outlets to provide it with gas, mainly Russia and Algeria. Europe cannot reach a phase of self-sufficiency in terms of gas and welcomes any other source, including the Gulf and Iran.”