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The Iraqi government has invited companies to bid for 11 exploration blocks with natural gas reserves as part of a push to boost its self-sufficiency in the hydrocarbon.
According to a statement by the Oil Ministry, eight of the blocks are located in the western part of the country, one is in northern Iraq, and two are in central Iraq. All of these are new areas of oil and gas exploration, Reuters noted in a report.
Iraq, which is the second-biggest oil producer in OPEC, flares most of the associated gas that comes out of its oil wells instead of capturing it and using it for power generation. For that purpose, it imports natural gas from neighbor Iran. It relies on Iranian gas imports for as much as 40% of its power generation needs.
The United States has been pressing Baghdad to change the situation, urging it to exploit its own natural gas reserves. As a result, the Iraqi government recently stated its intention to end imports of natural gas by 2026.
“We are burning money,” Iraq’s Prime Minister Mohammed Shia al-Sudani said recently, referring to the 1,200 cubic meters of natural gas that Iraq flares every day and the 1,000 cubic meters of natural gas that the country imports from Iran every day. This “costs us no less than 4 billion dollars a year,” al-Sudani explained.
Yet this is not the first time Iraq has promised to stop flaring its gas and put it to good use. The country is a signatory to the World Bank and the UN’s Zero Routine Flaring initiative, which means it has committed to stop the practice by 2030, but so far little has been done.
Iraq is home to some 131 trillion cubic feet of natural gas reserves, which makes them the twelfth-largest in the world. Yet the country is suffering from chronic blackouts for lack of enough fuel for its power plants.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com