Iraq announces new bidding round to explore and develop gas reserves

The Opec member is offering 11 gas exploration blocks in different parts of the country

Nahr Bin Umar oilfield, north of Basra. The latest bidding round would be sixth since 2009 in Iraq as it looks to expand its hydrocarbon reserves. Reuters
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Iraq is inviting international energy companies to take part in an energy bidding round to explore and develop natural gas reserves, the country’s oil minister said on Sunday.

Hayan Abdel-Ghani said 11 gas exploration blocks in different parts of the country would be on offer and described them as “promising”.

Of those, eight blocks are in Anbar province in western Iraq, while two are shared by Anbar and Nineveh in northern Iraq and Najaf province in the south. The last block is in Nineveh province.

Mr Abdel-Ghani invited interested international companies in “exploration, development and production” to submit their requests to the oil ministry. He didn’t specify a deadline.

“The oil minister and concerned parties pledge to offer all the needed facilities and support to the companies,” he said in pre-recorded video speech.

The planned bidding round will be the sixth since 2009 as Iraq continues it push to expand its hydrocarbon reserves.

Last month, Mr Abdel-Ghani announced an appendix to the fifth bidding round, offering 13 sites across northern, central and southern parts of Iraq.

The round included eight oil and gasfields and five exploration sites. Preparations are expected to be finalised later this month or by mid-July, he said at the time.

Despite being Opec’s second-biggest producer, Iraq is dependent on Iran for about a third of its electricity needs. It buys both electricity and natural gas to generate power from its neighbour but still has electricity shortfalls that result in extended power cuts across the country.

Baghdad has been under pressure from Washington to wean itself off Iranian energy imports, which have been subject to US sanctions since 2018.

Since then, Washington has repeatedly extended waivers to Baghdad for periods of between 45 to 120 days to be able to import Iranian electricity and gas.

Iraq has taken some measures to further develop its natural gas resources and reduce the shortfalls in the electricity sector in recent years.

It is finalising a deal with French energy major TotalEnergies to develop oil and gas and renewable energy projects worth $27 billion.

Iraq will hold a 30 per cent stake in the joint venture, while 45 per cent stake will go to TotalEnergies and the remaining 25 per cent to QatarEnergy.

The Gas Growth Integrated Project will recover flared gas on three oilfields 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.

It will also develop a one-gigawatt solar power plant to supply electricity to the Basra regional grid.

The country is also holding discussions with Saudi companies, including Aramco, to invest in its oil and gas sector.

Among the opportunities on the table is a deal to develop Akkas field, a major gasfield near the Syrian border.

Iraq’s natural gas reserves stand at around 3,714 billion cubic meters.

Updated: June 18, 2023, 2:55 PM