Iraq's Oil Ministry signed an agreement on Wednesday for a fully integrated energy project in the southern province of Basra, as the country seeks to increase its oil and power supply.
The agreement is with a consortium that includes Chinese company Geo-Jade and the Iraqi Hilal Al Basra (Crescent Basra) and will combine upstream oil and gas production with downstream refining, petrochemicals and power generation, Iraq’s Oil Minister Hayan Abdel Ghani said at the signing ceremony in Baghdad.
The South Basra integrated energy project includes expanding the Tuba oilfield, increasing production from 20,000 barrels a day to 100,000 bpd, Mr Abdel Ghani said.
A refinery with a capacity of 200,000 bpd will be built along with a petrochemical plant with a capacity of 620,000 tonnes a year and a fertiliser plant with a capacity of 520,000 tonnes a year, he added.
Two power plants – including a 650 megawatt thermal power plant and a 400MW solar power plant – will also be part of the project, he said.
No details were given on the value of the project or anticipated timelines.
The first-of-its-kind deal in Iraq “represents a qualitative leap in developing oil wealth and supporting the national economy”, Mr Abdel Ghani said.
“The project will contribute to achieving economic development, providing job opportunities for thousands of Iraqi workers.”
Bassim Mohammed Khudhair, deputy minister of oil for extraction affairs, called the deal a “major achievement”, adding that the ministry “has similar projects under study and discussion”, without elaborating.
The project marks a milestone in Iraq’s efforts to develop its oil and gas sector to support its national economy and meet mounting electricity demand. Oil sales make up about 95 per cent of the federal revenues.
In 2023, Iraq signed a deal with French company TotalEnergies to develop oil and gas and renewable energy projects in the south worth $27 billion.
Iraq holds a 30 per cent stake in the joint venture, while 45 per cent is held by TotalEnergies and the remaining 25 per cent by QatarEnergy.
The Gas Growth Integrated Project will recover flared gas at three oil fields to supply gas to power generation plants. It will build a seawater treatment plant for providing water injection for pressure maintenance, as an alternative to the use of fresh water from rivers and aquifers.
