Iraq inks gas deals with foreign firms

BAGHDAD: Iraq on Sunday signed deals with Turkish, Kuwaiti and South Korean energy firms to develop two gas fields in the centre and south of the country, after they were awarded in October.

The final contract agreements came just days after Baghdad initialled a preliminary accord with Seoul's Korea Gas Corporation (KOGAS) to exploit Akkaz field in the western province of Anbar.

Sunday's deals were for Mansuriyah field in Diyala province, northeast of Baghdad, and Siba field in Basra, Iraq's southernmost province.

"We need to develop these two fields to support the ministry of electricity, so its stations can work better," Oil Minister Abdulkarim al-Luaybi said at the contract signing attended by the press.

"This is a very important day, and it represents a new beginning for the oil industry."

The Mansuriyah contract was with a consortium made up of Turkey's TPAO, Kuwait Energy and KOGAS, while Siba is to be developed by Kuwait Energy and KOGAS.

Mansuriyah has estimated reserves of 127 billion cubic metres (4.5 trillion cubic feet) of gas, while Siba has 34 billion cubic metres (1.5 trillion cubic feet).

Baghdad needs the energy revenues from the increased production to rebuild a war-battered economy and fill chronic electricity shortfalls.

Iraq's current gas production -- all of it associated gas from oil wells -- is 1.5 million cubic metres a day, but half is burned off in flares from oil wells, according to Baghdad-based analyst Ruba Husari.

Copyright AFP (Agence France-Presse), 2011