Abu Dhabi National Energy Company (Taqa) has signed a joint venture agreement to buy a 50 per cent stake in a 750MW independent power project (IPP) at Sulaymaniyah, in the Kurdistan region of Iraq.

The stake was previously owned by Jordan’s Mass Holding, which will continue to hold the remaining 50 per cent ownership. The power plant has been developed in stages, each of which has been financed on Mass Holding’s balance sheet. The most recent phase was commissioned in April 2011.

Mass Holding is currently adding another 250MW unit to the project to take the total capacity to 1,000MW. Switzerland’s ABB is undertaking the engineering, procurement and construction work and the turbines are being supplied by the US’ GE. Taqa will own half of the new unit when it is commissioned in July/August.

Mass Holding has previously stated plans to convert the Sulaymaniyah simple-cycle power plant to combined cycle technology. This will add a further 500MW capacity. A 15-year take-or-pay agreement has been agreed with the Kurdistan Regional Government’s (KRG) electricity ministry for the development.

The project runs on natural gas as its main fuel, which is supplied through the KRG. Light diesel is used as back-up fuel. The facility receives gas from an underground pipeline which is connected to the Khor Mor gas field. The gas production, processing and transmission equipment is operated by Pearl Petroleum Company, which is owned jointly by Dana Gas (40 per cent), the Crescent Petroleum (40 per cent), both from the UAE, Austria’s OMV (10 per cent) and MOL Hungarian Oil and Gas Company (10 per cent).

Until January 2012, the Sulaymaniyah IPP was operated and maintained by the UK’s Wood Group. Mass Holding cancelled the contract, choosing to operate the scheme itself with assistance from Turkey’s Enka.

According to Taqa, the acquisition is the result of its strategic focus on Iraq, “Iraq is a key target market…Taqa acquired a 19.9 per cent stake in Canada-based Western Zagros in 2011. This was a strategic investment in a company holding acreage in the Kurdistan region of Iraq.”

In addition to the Sulaymaniyah poject, Mass Holding owns IPPs at Erbil and Dohuk. Mass Holding is not in discussions with any investors to buy stakes in any of its other IPPs, says the company’s director of power, Abdul Qader. “[But] we are planning another [IPP] at Erbil, near the existing plant, but these are very preliminary plans,” says Qader.