Iran Says It’s Close to Resolving Gas Export Issues With Iraq
(Bloomberg) -- Iran and Iraq are close to resolving a dispute over disruptions to Iranian gas supplies and Baghdad’s unpaid dues for the exports, Iran’s Oil Minister Mohsen Paknejad said Saturday.
“We will soon witness the resolution of both issues,” the state-run IRIB News cited Paknejad as saying after meeting with Iraq’s Electricity Minister Ziad Ali Fadhil in Tehran.
The shortfall in Iranian gas supplies has resulted in cutbacks in Iraqi electricity production, according to a recent statement by Fadhil’s ministry, putting an additional strain on the Iraq’s already fragile grid at a time of high summer demand.
On Tuesday, Saeed Tavakoli, head of the National Iranian Gas Company, said Iran’s power plants have been extensively burning mazut — a dirtier alternative to natural gas — to keep the local grid running. That could potentially free up more gas for export.
Despite holding the world’s second-largest natural gas reserves, Iran has struggled in recent years to meet domestic demand and maintain stable exports. Last year, it extended its gas export agreement with Iraq for five years, which, according to the Iranian Oil Ministry’s Shana news agency, allows for seasonal fluctuations in export volumes to prioritize Iran’s domestic needs.
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