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Iraq to go ahead with development of associated, free gas projects: official

Iraq is moving ahead with plans to develop associated and free gas projects in the next two to three years, an oil ministry official said June 9, as the OPEC’s second largest oil producer seeks to lower dependence on gas imports from Iran.

Currently, the ministry is looking at projects to develop 1.2 billion standard cubic feet of associated gas per day out of 2.7 billion scf/d that is produced, Hamed Younis, deputy oil minister, told S&P Global Platts June 9.

“When these projects are done, we would have developed all of the gas associated with oil production,” Younis said.

The 1.2 billion scf/d projects include 200 million scf/d at Nasiriyah field, 300 million scf/d at Halfaya, 400 million scf/d at Ratawi and 300 million scf/d from other fields, he added.

Associated gas currently makes 70% of total gas reserves in the country, with the rest being free gas, Younis said.

US waivers

Iraq relies on Iranian gas and electricity to help plug its gas shortage and electricity deficit. The country has been receiving temporary US waivers to continue the imports amid sanctions on Tehran’s energy sector.

In the week ended June 6, Iraq renewed an agreement to continue to import Iranian electricity for 2020 and 2021.

The US on May 7 extended Iraq’s sanctions waiver for 120 days to import Iranian electricity, as the Donald Trump administration seeks to support the new Iraqi prime minister appointed that month and provide some stability to the politically fractured nation.

The US had sought to squeeze Iran by imposing sanctions on its energy exports in 2018. The length of the waivers to Iraq was shortened, as the US has pressured Iraq to reduce its dependency on Iranian energy supplies.

The last waiver, for 30 days, had been granted on April 26.

Akkas field

Iraq also has plans to develop free gas fields, mainly Akkas and Mansouriya.

“Due to the security situation where these fields are located, investment in these fields was delayed but the ministry now has plans to develop both of them,” said Younis.

Akkas can produce 400 million scf/d, while Mansouriya can produce 300 million scf/d.

South Korea’s state-run Korea Gas Corp., or Kogas, signed a deal in 2011 to develop Akkas, Iraq’s largest non-associated gas field. The Islamic State seized the field during its occupation of swathes of Iraq in 2014-2017 war and Iraqi forces later recaptured the field in 2017

“We are in discussion with the company to start development of the field,” Younis said. “They may continue or bring new partners to develop the field. We are keen to speed up the development of the field.”
Source: Platts

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