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By John Lee.

Iran has reportedly suspended the supply of gas and electricity to Iraq, at a time when the country is struggling to cope with with soaring temperatures.

According to AP, Iraq already owes Iran $4 billion for energy imports, and Iran is pushing to have the debt paid.

More here.

(Source: AP)

The International Finance Corporation (IFC), a member of the World Bank Group, is investing in Basrah Gas Company (BGC) to support one of the largest gas flaring reduction projects in the world, helping to improve energy access, prevent associated greenhouse gas (GHG) emissions and support a more resilient, sustainable energy sector in Iraq.

BGC is an Iraqi joint venture created to treat and process associated gas that would otherwise be flared. The project is expected to increase BGC's processing capacity, thereby avoiding more unnecessary flaring and associated GHG emissions by around 10 million tons per annum. It will support Iraq's transition to a lower carbon path and improve access to a domestic energy source, helping the country meet its growing power needs.

IFC is the lead arranger of the five-year, $360 million loan to BGC.

Ihsan Abdul Jabbar Ismail, Minister of Oil for Iraq, said:

"Signing the loan agreement reinforces the collective efforts to increase investment in associated gas flaring reduction using world-class technologies. It is in line with our objectives of turning flared gas into cleaner valuable energy and reducing the impact of the Green House Gas emissions on the environment.

"This loan opens new horizons for cooperation and collaboration that serve common purposes and interests, reiterating Iraq's commitment to increasing investment in associated gas flaring reduction and to achieving the objectives set by the Paris Agreement."

Malcolm Mayes, BGC Managing Director, said:

"We are delighted to have successfully signed this loan with IFC, the first loan facility of its kind in the energy sector in Iraq-a milestone to be proud of.

"The agreement demonstrates the strength of Iraqi companies and their ability to attract funding and trust from international banks. The intent of this five-year loan is to support BGC's growth project and turn the otherwise wasted flared gas into much needed energy for the country. Our strategy is in alignment with the government of Iraq's vision to power Iraqi homes with electricity and create a more sustainable energy industry."

Sérgio Pimenta, IFC Vice President for the Middle East and Africa, said:

"This pioneering project has the potential to deliver significant environmental and economic benefits, including lower GHG emissions and increased fiscal revenues, and will improve energy access and lower costs for Iraqi citizens.

"The project comes after years of hard work and strong cooperation by all parties involved. We hope that it will send a strong signal to other investors and help drive more private investments to tackle climate change and support inclusive growth in Iraq."

IFC's investment comprises a $137.76 million loan for IFC's own account, a $180 million loan in which participations were syndicated to eight international banks (Bank of China, Citi, Deutsche Bank AG, Industrial Commercial Bank of China, Natixis, Sumitomo Mitsui Banking Corporation, Société Générale and Standard Chartered Bank), and a $42.24 million loan through IFC's Managed Co-Lending Portfolio Program, a platform that allows institutional investors to participate in IFC's loan portfolio. The loan is without recourse to or guarantees from any of the shareholders.

Iraq is endowed with significant reserves of natural gas, mainly produced as a byproduct of legacy oil extraction. However, in the absence of adequate infrastructure to capture and process it, about 70 percent of all natural gas produced in the country is flared. Capturing associated gas for subsequent use can help Iraq reduce overall emissions.

The project benefits from long-standing engagements of the World Bank Group in Iraq's energy sector. Iraq joined the Global Gas Flaring Reduction initiative in 2011 and committed in 2013 to eliminate all routine natural gas flaring by 2030.

(Sources: IFC, Iraqi Govt)

By John Lee.

Iraqi Prime Minister Mustafa al-Kadhimi has officially opened the first phase of the new Samarra power station.

The second phase is scheduled to be completed later this year.

The station will supply the grid with up to 1260 MW of electricity, and will serve northern Baghdad and Salah al-Din governorate.

A third phase of development is under discussion with a Chinese company.

(Source: Govt of Iraq)

By John Lee.

Masdar, a subsidiary of the Abu Dhabi-based  Mubadala Investment Company, has signed a strategic agreement to develop 2,000 MW of solar photovoltaic (PV) projects in Iraq.

Heads of Agreement (HOA) were signed at a virtual ceremony by His Excellency Majid A. Hantosh, Minister of Electricity, the Republic of Iraq, Her Excellency Suha Al-Najar, President of the National Investment Commission (NIC) for the Republic of Iraq, and Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar.

The signing took place in the presence of His Excellency Ihsan Abdul Jabbar Ismail, Minister of Oil for the Republic of Iraq, His Excellency Suhail Al Mazroui, Minister of Energy for the UAE, and His Excellency Dr Thani Al Zeyoudi, the Minister of State for Foreign Trade for the UAE.

His Excellency Ihsan Abdul Jabbar Ismail, Minister of Oil for the Republic of Iraq, said:

"The Government intends to increase and enhance the national production of clean energy. Through this agreement with Masdar, we will generate 2 GW of solar power through projects in central and southern Iraq.

"Iraq is targeting 20 to 25 percent of energy coming from renewable sources, rather than fossil fuels, equivalent to 10 to 12 GW. This agreement with Masdar, a global leader in renewable energy, is an important step in the development of the clean energy investment sector and the exploitation of solar energy in Iraq."

HE Suhail Al Mazroui, Minister of Energy for the UAE, said:

"We are grateful to the Government of Iraq for providing Masdar with the opportunity to contribute to the implementation of the Republic of Iraq's renewable energy strategy. The UAE is committed to working with the Republic of Iraq to develop sustainable energy resources. This initiative also highlights the importance of public and private sector partnerships in finding affordable solutions.

"Masdar has been a pioneer in developing clean energy projects, and is now active in more than 30 countries around the world, with a total value of more than US$20 billion and a production capacity exceeding 11 gigawatts. Masdar will leverage the expertise it has built up through these projects to support the Republic of Iraq on its clean energy journey."

HE Dr. Thani bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade, underlined the strong brotherly relations that unite the UAE and the Republic of Iraq, supported by many deep political, social and economic ties, and driven by the keenness of the leadership of the two brotherly countries to enhance prospects for cooperation in all fields, especially vital areas of common interest.

He pointed out that the cooperation between Masdar and the government of the Republic of Iraq will add significant value to the Emirati and Iraqi partnerships in addressing the challenges posed by climate change and keeping pace with the growing demand for energy. It will also contribute to supporting Iraqi efforts aimed at implementing quality projects to produce 10 gigawatts of solar energy by 2025.

HE Al Zeyoudi further affirmed the UAE's keenness to facilitate channels of technology transfer, enrich knowledge and encourage the exchange of the best and most successful experiences to promote economic development in Iraq.

HE Suha Al-Najar, President of the National Investment Commission for the Republic of Iraq, said:

"The project is one of the largest renewable photovoltaic solar projects in the Middle East, and falls within the vision of Iraq's sustainable transition plan 2021- 2030. The project delivers 2 GW of green energy for Iraq national network. It opens the way for cooperation and knowledge exchange between the two parties in the field of energy planning and sustainable transition. A steering committee of both parties is established for this goal. The business model is Independent Power Producer, and the investment will be according to law13-2006 of the National Investment Commission.

"The project ensures clean and sustainable energy production for different areas in Iraq, and displaces carbon dioxide emissions resulting from fossil fuel generation. The project will also provide new jobs in the energy sector, with the manpower for project construction and operation beyond 2,000."

Mohamed Jameel Al Ramahi, CEO of Masdar, said:

"This agreement will define the path for the development of clean energy solutions that will drive growth in the Republic of Iraq and help the Government meet its climate goals. The UAE shares Iraq's commitment to diversify away from a dependence on oil & gas, and to accelerate the transition to clean energy sources. We are proud to support the Government of Iraq on this vital stage in its clean energy journey and we will leverage our expertise to deliver a more sustainable future for the nation."

(Sources: Masdar, Govt of Iraq)

By John Lee.

Iraq's Ambassador to Kuwait, H.E. Mr. Al-Manhal Al-Safi, met on Friday with the Kuwaiti Minister of Electricity, Water and Renewable Energy, H.E. Dr. Mishaan Al-Otaibi.

They discussed cooperation in renewable energy and natural gas, as well as developments in grid connection to supply Iraq with electrical power.

(Source: MoFA)

By John Lee.

Iraq is reportedly planning to build eight nuclear power stations to provide much-needed electricity.

According to Bloomberg, the $40-billion scheme would provide 11 GW of power to the Iraqi grid.

Click here to read the full article.

(Source: Bloomberg)

Ten electricity plants were provided with transformers at a ceremony attended by Deputy Prime Minister Qubad Talabani in Koya town on Thursday.

The Deputy Prime Minister commended the Koya transformer project and addressed developments in the electricity sector, including the Kurdistan Regional Government's decision to go all in on natural gas.

"The power generation costs are still high," said Deputy Prime Minister Talabani, "and to solve this, we are planning to increase the dependency on natural gas to 100 percent as a source of fossil fuel in power generation."

Also in attendance at the Koya ceremony was Minister of Electricity Kamal Mohammed Salih, who provided more information on the 2.728 billion dinar (or roughly 1.8 million USD) transformer project.

Minister Salih hailed the cabinet's achievements in power generation and distribution, and stated that more than 450 projects have been initiated with a total worth of 60 billion dinars.

KRG is planning to open three more power plants in the Kurdistan Region by the end of this year: a steam power plant in Khabat District, a gas power plant in the Garmian region, and a 37-megawatt plant in Deraluk.

The Deputy Prime Minister Qubad Talabani also talked about his latest visit to Baghdad with the KRG delegation to discuss the region's share of the budget.

He noted that one of the topics of discussion was cooperative power generation between the federal and regional governments, a step that would drastically increase Iraq's supply of electricity.

(Source: KRG)

By John Lee.

At its regular meeting on Tuesday, the Iraqi Cabinet agreed to send an invitation, "in a single bid manner", to the French company Total to invest in a project to generate 1,000 megawatts of solar electric power.

The project was originally agreed in March as part of a larger engagement with the French energy company, which last week announced that it would rebrand itself as TotalEnergies.

The cabinet also approved a request from the Ministry of Electricity to award a contract "in a single bidding manner" to the Chinese company PowerChina (Power Construction Corporation of China).

(Source: Govt of Iraq)

Ministerial delegations from Iran and Iraq agreed on plans to promote cooperation on customs affairs, pave the way for joint investment, and expand the capacity for transportation between the two neighboring countries.

After two rounds of meetings on Saturday, delegations led by Iranian Economy Minister Farhad Dejpasand and Iraq's Finance Minister Ali Abdul-Amir Allawi reached agreements on closer trade ties between Tehran and Baghdad.

Speaking at a press conference after the meetings, Dejpasand said the new agreements entail plans to address the problems relating to customs, exchange experiences in customs affairs, and facilitate the activities of the two countries' business people.

He noted that Iran and Iraq have also agreed on organized plans for joint investment in order to increase foreign investment in the two countries by setting up new industrial complexes.

Another issue agreed upon in the meetings was the expansion of the capacity for the transportation of rail passengers and cargo between the two neighbors.

Iran and Iraq held the 4th session of Economic Cooperation Joint Commission in January, weighing plans for stronger cooperation in various sectors with an eye to the geographical, cultural and religious commonalities between the two Muslim neighbors.

Participants in the meeting are also planned to discuss the ways to boost economic ties, promote exports, and evaluate the markets for optimum productivity in various sectors, such as the transportation and energy industries, tourism sector, construction projects, and water and electricity industries.

(Source: Tasnim, under Creative Commons licence)

The Rumaila Operating Organisation (ROO) has announced its 2020 performance results.

The field's oil production rate averaged 1.392 million barrels per day (bpd), despite the impact of COVID-19, a budget reduction and compliance with instructions from BOC to reduce oil production, which reflected OPEC+'s request for Iraq to curtail oil exports.

The year's strong performance has been attributed to the dedication of the field's workforce (which is 96% Iraqi) to adapt to and overcome major new challenges. These included a revised and reprioritized production strategy, which benefitted from the strong foundations laid in previous years to modernize facilities, optimize wells and deploy advanced technologies.

Basra Oil Company (BOC) Director General, Mr Khalid Hamza Abbas, said:

"Rumaila's achievements in 2020 deserve great recognition, not least within the context of the global pandemic. My thanks go to every member of staff who did his or her utmost to ensure the field continued to serve the nation at this most difficult time."

Rumaila's 2020 achievements included record-breaking levels of water injection, averaging 1.35 million bpd of water - volumes never previously seen at the field. New digital technologies were deployed to maximize efficiencies; 21 new wells were drilled, 115 wells were optimized or renewed, and almost 7,000 well services jobs were conducted to further maintain production, while preventative maintenance and repairs ensured the continued performance of ageing facilities.

In addition, new projects were initiated to reduce Rumaila's operational carbon emissions, particularly utilizing electricity from the gas-fired Rumaila Power Plant, rather than diesel generators, to power some key facilities in the field.

Rumaila also continued to support local communities living near or within the field during the pandemic, with ongoing initiatives to help the Al-Khora Primary Health Care Clinic and the North Rumaila Mobile Health Clinic; ROO also oversaw and delivered the procurement, shipping, installation and training on a computed tomography (CT) scanner for the Basra Al-Sadir Teaching Hospital. Major renovation works also took place at Al Sikak, Al Rumaila and Al Nukhaila schools in order to enhance the quality of local education.

With the onset of the pandemic, global oil demand contracted, resulting in the already low international oil price falling further and causing governments and companies around the world to review their plans. Iraq was no exception and resulted in the ROO's annual budget reduced by around 30%, with adverse impacts on some development projects and well and production-raising activities.

In addition, government-requested curtailments averaged 55,000 bpd over the course of the year, partly in response to Iraq's compliance with OPEC+'s request to reduce the country's overall oil exports.

2020 was therefore a year defined by COVID-19. It has always been ROO's commitment to place the health and safety of staff members above all other considerations. COVID-19 therefore required multiple preventative and responsive activities to limit the transmission of the virus. Field personal protective equipment (PPE) was sourced and distributed, including 300,000 sets of gloves, 20,000 masks, and 1,300 units of hand sanitizing products. Two new clinics were established; additional respiratory and life support equipment were secured; 4,370 diagnostic tests were carried out; contact tracing was instigated after each suspected and confirmed COVID-19 case, and wellbeing initiatives were introduced.

Operationally, the field had to adapt to major disruptions to the way everyday work was delivered. Field staff had to contend with working fewer, yet longer shifts patterns; movement was restricted at Rumaila headquarters which is staffed by a limited number of Iraqi and international colleagues who all adhered to strict quarantining protocols on arrival; hundreds of Iraqi and expatriate staff adapted to working from home. A new IT terminal server enabled staff working remotely in Basra and around the world to securely access emails, files and industry applications, while the number of videoconferencing users increased 960%.

ROO Deputy General Manager, Hussein Abdul Khadim Hussein, said:

"With the virus making its way to Iraq, we knew we had to do everything we could to keep our people as safe as possible while at work. We also had to move quickly, to ensure that the day-to-day operation of the entire field could be maintained, so that Rumaila could continue to deliver for Iraq. The human cost of COVID-19 has been felt by everyone at Rumaila; to everyone affected, we extend our deepest sympathies."

ROO General Manager, Orkhan Guliyev, said:

"The tremendous co-operation and teamwork between BOC, bp and PetroChina, which in previous years had been key to Rumaila surpassing targets, expressed itself in 2020 through a shared sense of resilience. The determination, dedication, patience and endurance of our people enabled us to continue to make progress during what was an extraordinarily challenging year for everyone."

Rumaila Special Deputy General Manager, Fan Jianping, added:

"It has been a difficult operating environment for national and international oil companies across the world. At Rumaila, it has been humbling to see such strength of purpose in overcoming complex challenges. 2020 has further illustrated that our partnership has the focus, fortitude and capability to face tough challenges."

(Source: ROO)