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    Iran Boosts Flows to Iraq


Lower heating demand at home enables more exports but other problems have affected flows to Turkey.

by: Dalga Khatinoglu

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Natural Gas & LNG News, Middle East, Premium, Corporate, Import/Export, Political, Infrastructure, News By Country, Iran, Iraq, Turkey

Iran Boosts Flows to Iraq

Iran has resumed exports to Iraq at 32mn m3/day as domestic housing demand has gone from 600mn m3/d in winter to 250mn m3/d, the National Iranian Gas Company (NIGC) announced April 28. Last year, soaring demand led it to cut exports to just 3mn m3/d.

NIGC says its total exports grew 26% yr/yr to 17.5bn m3 in the fiscal year, ended March 20. Turkey’s official statistics indicate 7.8bn m3 came from Iran during this period, which was the same as the year before, while Iraq received 4.8bn m3 of gas from Iran in the previous fiscal year (ended March 20, 2019).

Iraq needs Iranian gas for its thermal power plants. About a third of the country’s power demand comes directly from Iran or is generated at power plants which run on Iranian gas. Its summer peak demand stands at 25 GW, while the domestic power generation capacity is below 20 GW, leading to frequent power outages.

Recently Iraqi electricity minster Luay al-Khatteeb has said it would take three or four years to redirect flared gas into power generation and so make the country independent from Iranian gas.

Iraq flares 17.85bn m3/yr associated gas. It established Basrah Gas Company (BGC) joint venture in 2013 with $17bn of projects to cut flaring. Local state-owned South Gas Company holds 51% stake, Anglo-Dutch major Shell 44% and Japan’s Mitsubishi has 5% in BGC.

The JV succeed to add more than 3bn m3/yr to the country’s sale gas in 2018, but developing the new projects need $10bn investment.

The International Monetary Fund expects Iraq’s budget to face a $40bn deficit in 2020 owing to low oil prices, meanng the government would owe $140bn.

Turkey's imports stop from Iran

The pipeline carrying Iranian gas to Turkey exploded in Turkish territory on the morning of March 31, cutting off supplies.

This is 11th time that the terrorist groups blast the pipeline during last 15 years, but each time it was repaired in one or two weeks. However, NIGC announced April 28 that repairing the pipeline may take at least two and a half months, meaning that Turkey will take on gas from Iran this quarter.