Iraq will receive about 23 million cubic metres of natural gas a day by the end of 2012 through a new pipeline from Iran.

Commenting on the deal, Amir Anvari, vice-president of Tehran-based Iran Power & Water Export of Equipment & Services Company (Sunir), told delegates at the MEED Iraq conference in Istanbul, that this would be enough to support about 10 of the 324MW power stations the company has just completed in the Sadr City district of Baghdad.

The two countries signed a memorandum of understanding in August 2010 paving the way for gas imports for a period of five to seven years (MEED 3:8:10).

Despite its considerable gas reserves, estimated at 29.6 trillion cubic metres, almost 16 per cent of total global reserves, Iran continues to play only a small role in the global gas market. Most of its gas is used domestically. 

Iraq, on the other hand, has only 3.2 trillion cubic metres, much of which comes from associated oil fields. Almost 60 per cent is flared due to the lack of infrastructure to process it. The country suffers severe power shortages due to its ongoing lack of gas feedstock for its power stations.