Tuesday, May 24, 2011

Iraq, Iran sign power deal

Power as in electricity.

Reuters

Iraq's electricity ministry said on Sunday it has signed an initial agreement with Iran to import natural gas for power generation.

Under the memorandum of understanding between the two neighbours, Iran will install a pipeline through Iraq and supply it with gas that would be used to feed two power plants in Baghdad, the electricity ministry said.

Iraq will buy 25 million cubic metres of gas each day from Iran under the five-year deal, according to international prices, which would generate 2,500 megawatts.

The gas pipeline will pass through Iraq's Mansuriyah gas field near the Iranian border in volatile Diyala province. The gas would supply a power plant in Sadr City in northern Baghdad, and another plant in the northern outskirts of Baghdad. The pipeline will be completed in 18 months.

I'm puzzled that Iraq is willing to make itself so dependent on Iran. You'll remember how Russia has held up with its customers dependent on Russian pipelines. Perhaps this is an indication of how desperately troubled electricity production is in Iraq. I would have thought (although it's not cutting edge technology) that Iraq would build oil-fired generation plants instead.

2 Comments:

Anonymous Anonymous said...

It appears you do not know much about what you have written here.

Al Sadr Power Plant has been built by Iran and is currently running on Diesel. But the plant is built to run on both Diesel and Natural Gas but since natural gas is almost five times cheaper than Diesel, it is economically saner to run power plants on natural gas and only run the plants on Diesel when Natural Gas is unavailable or in emergencies. It becomes more prudent when realzing that Iran is building some 2000 MW of power plants in Iraq.

1:01 AM  
Anonymous Faye said...

It can't really have effect, I think this way.

6:21 AM  

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