As Iraq pushes ahead with its proposed $620bn development programme, the main challenge will be ensuring that adequate gas is available to allow progress on vital power and industrial schemes.

MEED’s Iraq Energy Projects conference held in late February was told that Baghdad is planning to boost its oil exports by nearly 26 per cent to reach 3.4 million barrels a day in 2014, boosting its position as one of the world’s largest exporters. In addition to swelling government accounts, private businesses from all around the globe are looking to tap into Iraq’s undoubted potential, even as security concerns remain.

Due to years of neglect under Saddam Hussein’s rule, and continued instability since the leader was overthrown by the US-led coalition in 2003, Iraq’s infrastructure is in need of significant investment. While the oil sector continues to develop, many areas in Iraq still suffer from chronic power shortages and blackouts.

The Electricity Ministry is pushing ahead with plans to develop 21,000MW of new capacity to meet the existing and future demand. However, while there is capital and interest from international firms in the programme, securing adequate gas feedstock to fire the plants will be the main challenge. In addition to building new gas turbine plants, the government is also planning to convert existing oil-fired plants to gas-turbines to improve efficiency and maximise returns from oil production.

Baghdad is pushing ahead with major gas schemes, such as the $17bn Basra Gas Project, in partnership with the UK/Dutch Shell Group, to provide gas supplies for power generation and reduce dependence on expensive imports from Iran. If Iraq is to meet its development targets, it is vital that it succeeds with such projects and securing adequate gas supplies remains a priority.