The China-Central Asia gas pipeline in Turkmenistan. Photo: VCG
Baghdad (IraqiNews.com) – Iraq is moving to reactivate its gas deal with Turkmenistan, which has been stalled for months, as part of Baghdad's urgent attempts to address the country's electrical crisis, which worsens throughout the summer.
Baghdad hopes to leverage recent diplomatic developments between Washington and Tehran, including the preliminary deal that clears the path for easing the sanctions on Iran, to restore energy supply channels.
Iraq is facing a significant power shortfall of more than 39,000 megawatts per day. Domestic electricity production fluctuates between 16,000 and 17,000 megawatts, while the actual demand during peak summer months exceeds 55,000 megawatts.
Sources informed Attaqa News that the recent agreement between Tehran and Washington would enable Baghdad to reactivate the gas deal with Turkmenistan, which was intended to supply Iraq with approximately five billion cubic meters of gas annually through Iran.
The deal involved a complex swap mechanism that entailed transporting gas from Ashgabat to Tehran in exchange for supplying Iraq with the same quantities from the Iranian network.
The arrangement stagnated due to the US's previous resistance to allow gas transit via Iran, along with Treasury Department restrictions that delayed execution, which terminated the negotiations.
The gas deal with Turkmenistan is important because Iraq needs over 70 million cubic meters of gas every day during the summer months. The country’s gas production only meets a part of that requirement, forcing Iraq to rely on Iranian imports.
Any easing of sanctions or adjustments to US exemptions could potentially pave the way for reviving Iraq's gas agreement with Turkmenistan via Iran.
The success of Iraqi efforts depends on the diplomatic developments between the United States and Iran, as well as the flexibility of US sanctions in the following time, which might affect Iraq's energy security for years to come.