Iraq explores Qatar and Oman as gas alternatives amid US pressure

According to a report in Reuters, following the US decision to block Iraq’s electricity imports from Iran, the Baghdad administration is considering Qatar and Oman as alternative suppliers in case Washington takes a similar step for gas trade. Hamza Abdel Baki, President of Iraq’s South Gas Company (SGC), stated that this option is on the agenda.

The Trump administration, as part of its “maximum pressure” campaign against Iran, announced on Saturday that it had lifted the sanctions waiver that had allowed Iraq to pay Iran for electricity since 2018. However, the much larger trade volume between the two countries is in gas.

Baghdad imports up to 50 million cubic meters of gas per day from Iran under a five-year extension agreement reached in March 2024. According to Iraqi energy officials, the country pays $4-5 billion annually for the gas it imports from Iran.

Iraq’s Minister of Electricity stated that if gas imports from Iran cease, the country’s electricity production, which is 27,000 megawatts per day, will decrease by one-third. To take precautions against this possibility, Iraq plans to lease a floating terminal capable of storing liquefied natural gas (LNG).

SGC President Abdel Baki said, “This measure was taken due to the possibility of Iranian gas being cut off. The government has tasked the Ministry of Oil with finding alternative sources.”

Abdul Baki stated that an agreement with the United Arab Emirates-based Breeze Investment (BI) for the LNG terminal would be signed at the end of March, and they expect the terminal to be operational by the middle of the year. The terminal will be located at the Hawr ez-Zubeyr Port in the Gulf and will be connected to a supply point near Basra in the south via a 45-kilometer pipeline.

The terminal will be able to supply at least 500 million cubic feet (14 million cubic meters) of gas per day, Abdul Baki said, noting that this corresponds to about one-third of the gas received from Iran.