Iraq Signs Energy Deals with US Firms to Boost Electricity Production

During Iraqi Prime Minister Mohamed Shia al-Sudani's visit to the United States, Iraq signed several memoranda of understanding (MOUs) in the energy sector with American companies. The agreements, unveiled on Wednesday following Sudani's meeting with US President Joe Biden on Monday, aim to boost Iraq's electricity production by rehabilitating power plants and optimizing the use of flared gas.

A key MOU was signed with US firm General Electric to maintain and modernize Iraq's electricity sector over a five-year period. The project will cover 18 power plants with a total production capacity of 7,500 megawatts and enable the supply of an additional 3,000 MW to the national grid. "The initiatives will help meet the growing electricity demand in Iraq through advanced gas power generation technologies, on-time servicing and maintenance of energy infrastructure, and the use of flared gas," stated Iraqi Minister of Electricity Zeyad Ali Fadhil.

Iraq also signed a letter of intent with GE Vernova to explore injecting 3 additional gigawatts of energy into the grid generated by highly efficient combined cycle power plants. The two sides reiterated their commitment to convert the Samawa and Nasiriya sites from simple to combined cycle and expand capacity at the Al Mansouria gas power plant.

Furthermore, an MOU was signed with Iraq's Ministry of Oil to explore the accelerated use of flared gas to boost power generation in select oil fields. These initiatives aim to strengthen and modernize Iraq's power infrastructure, enable the transition to a lower carbon energy future, and promote economic development.

Why this matters: Iraq struggles to provide enough electricity to its 43 million people due to decades of conflict, sanctions, corruption, and crumbling infrastructure. The country's power plants are currently highly dependent on gas imported from Iran, which has often cut supplies, exacerbating regular power outages. These agreements with US firms represent a significant step towards diversifying Iraq's energy sources and improving its electricity sector.

Prime Minister Sudani stressed the need for Iraq to diversify its energy sources, including plans to import electricity from neighboring Jordan and Kuwait. He also participated in a roundtable discussion with major US oil and gas firms in Houston, articulating a vision of collaboration and openness in the Iraq-US partnership. Iraq unveiled plans to shift 40% of its exports towards value-added oil derivatives, reduce gas imports, and address gas flaring through strategic collaborations with companies like Total and Honeywell.

Key Takeaways

• Iraq signed MOUs with US firms to boost electricity production and use flared gas.
• GE to maintain and modernize Iraq's electricity sector, adding 3,000 MW to the grid.
• Iraq to explore injecting 3 GW of energy from combined cycle power plants.
• Iraq to accelerate use of flared gas for power generation in select oil fields.
• Iraq aims to diversify energy sources, reduce gas imports, and address gas flaring.