Iraq is considering turning to Qatar to get its gas needs instead of remaining reliant on sanction-hit Iran, the official Iraqi daily Alsabah said on Friday.

Cheap gas supplies are needed to run Iraq’s electricity sector and they are abundant in Qatar, which had in the past expressed willingness to supply Iraq with gas, the paper said, quoting official sources and Iraqi experts.

The paper noted that Iraq would find it easier to import gas from Qatar due to the Western sanctions against Iran.

“Iraq will likely seek Qatari gas because of its competitive prices and better marketing terms,” a source told the paper.

It quoted well-known Iraqi economist Adnan Bahiya as saying Baghdad could obtain attractive supply terms from Qatar.

“There are some advantages that could push Iraq to turn to Qatar for its gas needs, including prices, marketing and respect of the supply contract,” Bahiya said, adding that supplies from nearby Iran have been disrupted many times in the past.

He said Iraq needs Iranian gas for the next three years to operate its power utilities but added that it has to look for other sources to ensure stable supplies in the future.

“I believe that Iraq can benefit from Qatari gas imports because of their relatively low prices….besides, these supplies will be uninterrupted because they are not affected by political factors as is the case with Iranian gas,” Imad Mahmadawi, another Iraqi economist, said, noting that Iraq relies on gas to operate several power units with a combined output capacity of around 7,000 megawatts (MW).

Iran has recently halted gas exports to Iraq because of financial disputes but resumed them after Baghdad said it paid Tehran nearly $11 billion.

Iraqi officials said lower supplies disrupted power generation through Iraq and prompted an agreement to trade gas for Iraqi crude.

Iraq, OPEC’s second largest oil producer, controls nearly four trillion cubic metres of natural gas but a large part of them have remained untapped.

(Writing by Nadim Kawach; Editing by Anoop Menon)

(anoop.menon@lseg.com)

Subscribe to our Projects' PULSE newsletter that brings you trustworthy news, updates and insights on project activities, developments, and partnerships across sectors in the Middle East and Africa.