Ukrainian company wins Iraqi Oil Ministry contract to develop major gasfield in Anbar

Iraq has signed a deal with a Ukrainian company to develop a gasfield in the western part of the Arab country as part of efforts to boost its energy supply.

Ukraine’s Ukrzemresurs will increase production at the Akkas gasfield to 100 million cubic feet a day, from 60 million cfd at present, within two years, Iraqi Oil Minister Hayan Abdel Ghani said.

That will increase to 400 million cfd within four years, he added.

Rights to develop the field, located in Anbar province, were first awarded to South Korea’s state-run Korea Gas in 2010.

Kogas signed a deal to develop it in 2011 but withdrew when the field was captured by ISIS. It was retaken by Baghdad in late 2017. Akkas is estimated to have 5.6 trillion cubic feet of gas reserves, according to the Iraqi Oil Ministry.

The deal was signed after a delay of several years “because of the war against terrorist gangs”, Bassim Mohammed Khudhair, Deputy Oil Minister for Extraction Affairs, said.

The latest deal will power the Anbar plant and the Akkas station, he added.

Despite being Opec’s second-biggest producer, Iraq is dependent on Iran for about a third of its electricity needs.

It buys electricity and natural gas to generate power from its neighbour but has shortfalls that result in extended power cuts across the country.

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

Washington has repeatedly extended waivers to Baghdad for periods of 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.

Last year, it signed a deal with France’s TotalEnergies to develop oil and gas and renewable energy projects 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 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 freshwater.

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