• 5 hours Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 9 hours Russia, Saudis Team Up To Boost Fracking Tech
  • 15 hours Conflicting News Spurs Doubt On Aramco IPO
  • 16 hours Exxon Starts Production At New Refinery In Texas
  • 17 hours Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 1 day Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 1 day Oil Gains Spur Growth In Canada’s Oil Cities
  • 2 days China To Take 5% Of Rosneft’s Output In New Deal
  • 2 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 2 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 2 days VW Fails To Secure Critical Commodity For EVs
  • 2 days Enbridge Pipeline Expansion Finally Approved
  • 2 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 2 days OPEC Oil Deal Compliance Falls To 86%
  • 2 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 2 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 3 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 3 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 3 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 3 days Aramco Says No Plans To Shelve IPO
  • 5 days Trump Passes Iran Nuclear Deal Back to Congress
  • 5 days Texas Shutters More Coal-Fired Plants
  • 6 days Oil Trading Firm Expects Unprecedented U.S. Crude Exports
  • 6 days UK’s FCA Met With Aramco Prior To Proposing Listing Rule Change
  • 6 days Chevron Quits Australian Deepwater Oil Exploration
  • 6 days Europe Braces For End Of Iran Nuclear Deal
  • 6 days Renewable Energy Startup Powering Native American Protest Camp
  • 6 days Husky Energy Set To Restart Pipeline
  • 6 days Russia, Morocco Sign String Of Energy And Military Deals
  • 6 days Norway Looks To Cut Some Of Its Generous Tax Breaks For EVs
  • 7 days China Set To Continue Crude Oil Buying Spree, IEA Says
  • 7 days India Needs Help To Boost Oil Production
  • 7 days Shell Buys One Of Europe’s Largest EV Charging Networks
  • 7 days Oil Throwback: BP Is Bringing Back The Amoco Brand
  • 7 days Libyan Oil Output Covers 25% Of 2017 Budget Needs
  • 7 days District Judge Rules Dakota Access Can Continue Operating
  • 7 days Surprise Oil Inventory Build Shocks Markets
  • 8 days France’s Biggest Listed Bank To Stop Funding Shale, Oil Sands Projects
  • 8 days Syria’s Kurds Aim To Control Oil-Rich Areas
  • 8 days Chinese Teapots Create $5B JV To Compete With State Firms
IEA: Oil Prices To Hit A Ceiling In 2018

IEA: Oil Prices To Hit A Ceiling In 2018

Global oil markets appear to…

Who Are The Biggest Buyers Of U.S. Oil?

Who Are The Biggest Buyers Of U.S. Oil?

Exports of U.S. petroleum and…

Iran Expanding Influence Through More Gas Deals

Iraq will become the biggest customer of Iranian gas in mid-2017 when it begins a six-year program of importing the fuel to the southern city of Basra.

Under the deal, Iran will double the amount of gas it supplies to Iraq, sending 20 million cubic meters of natural gas per day to Basra during cold weather and 35 million cubic meters per day during warm weather. The contract was signed on Nov. 11 by Reza Araqi, the head of Iran’s National Iranian Gas Co. (NIGC), and Iraqi Deputy Electricity Minister Khalid Hassan Saleh.

The first exports will be limited to a daily amount of about 7 million cubic meters, a volume that could rise to 20 million cubic meters per day. Araqi said the shipments can’t begin until Iran completes the pipelines and pressure-boosting facilities required for the gas shipments, a process that is expected take about 18 months.

Related: Global Supplies Outweigh Paris Attacks For Oil Prices

Araqi also said Iran will construct a conduit to divert gas from its 6th gas trunkline, known as IGAT 6, which now transports gas from the Iran’s huge South Pars offshore gas field in the Persian Gulf to the Iranian province of Khuzestan, which borders southern Iraq.

The price of the gas was not disclosed, but Araqi said it would be consistent with the current market price. Araghi added, “The pricing will be similar to that of the Baghdad contract.”

Araghi was referring to a deal signed in 2013 in which Iran agreed to supply 25 million cubic meters of gas per day to the Iraqi capital, Baghdad, in a deal worth $3.7 billion per year.

The agreement calls for Iran to ship 25 million cubic meters of gas to power plants in and around Baghdad using a 165-mile pipeline. Once it begins, that project is expected to earn Iran $3.7 billion per year. It has been delayed by concerns for the pipeline’s security as Iraq fights an insurgency waged by the Islamic State.

Related: Saudis Planning For A War Of Attrition In Europe With Russia’s Oil Industry

Azizollah Ramezani, the director of international affairs for the NIGC, said that so far, the Basra gas deal is limited to only six years, for a maximum total of 40 billion cubic meters of gas, because Iraq has begun several energy development projects, including efforts to increase its own output.

“If Iraq’s development projects fail to boost its gas output,” Ramezani said, “the deal may be extended, and there is room for more cooperation in this regard.”

The deal with Iraq is one of several involving gas that Iran has struck with nearby countries. It is already working on several projects, including the export of gas to Turkey and Pakistan; a gas-for-power deal with Armenia; and a gas swap with Azerbaijan.

Related: Korea Leading The Way With Ambitious Fuel Cell Project

After Russia, Iran has the second-largest reserves of gas in the world. It now produces about 600 million cubic meters of gas per day, virtually all of it consumed domestically because Western sanctions over its nuclear program, expected to be lifted next year, have limited its export capacity.

Relations between Tehran and Baghdad were strained, to say the least, until the United States invaded Iraq in 2003 and ousted its president, Saddam Hussein, who had suppressed the country’s Shi’a majority. The two neighbors even fought a particularly destructive war in the 1980s.

Since Saddam’s ouster, however, Iraq has been run by a Shi’a-majority government, and the two countries have become close political and economic allies.

By Andy Tully of Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News