Iraq to eliminate gas flaring by 2022

Oil minister Thamir Ghadhban said the country produced surplus gas in winter

TOPSHOT - An employee stands at the Hammar Mushrif new Degassing Station Facilities site inside the Zubair oil and gas field, north of the southern Iraqi province of Basra on May 9, 2018. / AFP PHOTO / HAIDAR MOHAMMED ALI
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Iraq aims to eliminate flaring of gas from its southern oil fields, which has led to billions of dollars of lost revenue by 2022, according to the country's energy minister.

“We are flaring lots of gas, especially in the south but at the same time, there are plans being conducted, executed to meet our objective. Our objective is zero flaring in the coming years. I cannot give you an exact month or year but we have to know what we are dealing with," Thamir Ghadhban told CWC Iraq Petroleum conference in London.

"With time, say by 2022 to be more specific, I would say most of the flared gas in Basra will disappear," added Mr Ghadbhan, who is also Iraq's deputy prime minister.

The World Bank estimates around 16 billion cubic metres of gas from Iraqi fields was flared in 2015, costing the economy billions in lost revenue. The loss of gas associated with oil production is particularly costly for Iraq, which experiences frequent outages across its power infrastructure, crippled by war. A 2018 study by Siemens found that Iraq could save about $5.2 billion over the next four years by reducing gas flared from its fields in addition to other power generation efficiency efforts. The country has prioritised the rehabilitation of its utilities sector and has invited multinationals such as Siemens and GE to help rebuild the infrastructure.

Baghdad is also forced to import gas from Iran to power its electric grid to avoid shortages in the summer months. Searing temperatures and a dilapidated power network have led to widespread protests against the government in the past.

"The ministry of oil is fully committed to stopping this phenomenon of gas flaring. From an economic point of view most of the new power plants have been constructed in Iraq are based on gas-driven turbines," said Mr Ghadhban.

"It’s an economic waste, we are importing expensive gas and also from an environmental point of view," he added.

Iraq has proven reserves of around 3.6 trillion cubic metres of gas, trailing its gas rich-neighbour Iran by a significant margin. Gas production in Iraq has only slowly picked up over the last decade as oil, the country's biggest revenue generator became the ministry's focus following the withdrawal of US troops from the country.

Gas production grew 28 per cent in 2018 to reach 13 billion cubic metres per day of gas, according to the latest BP Statistical Review of World Energy. However, consumption outstrips domestic production.

Mr Ghadhban declined to specify volumes being imported from Iran to plug the deficit, noting it was only during summer, with Iraq producing surplus gas during winter. He said the focus would remain on meeting domestic needs before the ministry looked towards building export capabilities.

Work was underway in Ratawi in Basra with the development of a 400 million cf/d capacity greenfield gas processing plant, awarded to Chinese contractor CPECC, said the minister.

"[It] is now being fabricated outside Iraq and will be installed in Ratawi,"  he said.

The ministry has also approved plans for the construction of a 301 milliom cf/d capacity plant to process gas associated with the Halfaya field.