Iraq eyes 2023 start of southern gas capture projects

Iraq aims to bring a project aimed at eventually capturing 200mn ft³/d of flared gas from two southern fields online by the end of 2023, the oil ministry said today, around six months ahead of an earlier schedule.

The project, which was awarded to US oil field services firm Baker Hughes in September 2021, involves the construction of modular gas processing plants at the Nasiriya and Gharraf oil fields in the Dhi Qar province to capture and treat gas that would otherwise be flared. That built on a preliminary agreement signed between Iraq's state-owned South Gas and Baker Hughes one year prior, in September 2020. South Gas is the majority shareholder of Iraq's Shell-led Basrah Gas (BGC).

Iraq's oil ministry said shortly after the September 2021 signing that the US firm had begun preparatory work earlier that year, and that the project was scheduled for completion by mid-2024. Today the ministry's undersecretary for extraction affairs Karim Hattab said Iraq is now hoping to bring the project online "at the end" of next year.

The captured gas will be used for power, and the LPG and condensate will help meet domestic demand for cooking gas. Any surplus gas will be made available for export.

The comments came as the oil ministry renewed its commitment to help accelerate the project by expediting the processes needed to secure the equipment and technology needed for its completion. Baker Hughes has said it is using advanced modular gas processing technology developed in the US and Italy at the project.

According to the World Bank Iraq flared 17.89bn m³ of gas in 2021, up from 17.37bn m³ in 2020, making it one of the world's largest protagonists of flared associated gas. With the country lacking the infrastructure needed to capture and utilise the gas, Iraq has relied heavily on neighboring Iran for gas and power imports. But these have been disrupted in recent years, because of Iraq's financial struggles and Iran's own export availability at times of high domestic consumption.

Iran most recently halted gas supplies to its neighbor in June over non-payment of arrears, fueling extended electricity shortages and political unrest in Iraq, particularly during the very hot summer months when temperatures regularly rise above 50°C.

By Nader Itayim