Oil Minister: Iraq anticipates self-sufficiency in oil derivatives by 2025
Shafaq News/ On Tuesday, Iraqi Oil Minister Hayyan Abdulghani outlined the nation's expectations for a cessation in the import of oil derivatives and the conclusion of gas flaring within the next five years.
In a statement at the Al-Rafidain Center For Dialogue RCD Forum 2024 in Baghdad, the oil minister addressed the recent withdrawal of Exxon Mobil from Iraq, attributing the decision to the company securing a more favorable offer elsewhere. At the same time, he noted ongoing negotiations with various foreign companies, citing significant progress with American firm KPR, among others.
"We are committed to fostering global collaboration in the oil sector, extending equal opportunities to nations, be they American, Chinese, or Russian," the minister said.
Abdulghani highlighted a "pivotal government commitment to halt gas flaring," revealing signed contracts for gas utilization from three Iraqi oil fields.
"This practice would cease permanently within five years, positioning Iraq as a leader in reducing thermal emissions.
Regarding Iraq's gas imports from Iran, Abdulghani clarified that "the country is not making payments due to sanctions, indicating a sum of ten billion euros." He also detailed a reduction in gasoline imports, from over 16,000 cubic meters per day to 5,000, attributing the achievement to initiatives led by Mustafa Karbala and the revival of dormant units in southern refineries.
Looking ahead, Abdulghani expressed the nation's optimism, forecasting an end to the importation of oil derivatives by 2025, paving the way for Iraq's self-sufficiency in meeting its energy needs.
Notably, amid the intricate landscape of global energy dynamics, Iraq, the second-largest producer within the Organization of the Petroleum Exporting Countries (OPEC) after Saudi Arabia, struggles with a notable dependence on Iran to fulfill its electricity and gas needs. This reliance ranges from a third to 30-40%, primarily due to shortcomings in domestic processing infrastructure.
Iraq, endowed with the world's fifth-largest oil reserves, estimated at 143 billion barrels, occupies a crucial position in the global energy arena.
Despite its substantial oil and gas reserves, Iraq faces challenges in becoming a major energy player. The country's natural gas reserves secured the fifth position among Arab nations in 2023, with Qatar leading the list, as reported by "Oil and Gas" magazine.
However, Iraq's journey is fraught with obstacles, including security threats and political instability, creating an unpredictable environment for investors. Aging infrastructure further compounds the challenges, struggling to manage the demands of production and processing.
Resource depletion and technical limitations amplify concerns about the future sustainability of Iraq's energy sector. The wasteful practice of gas flaring exacerbates environmental and economic issues, along with the economic turmoil and opaque contracts contribute to the complexity of Iraq's energy landscape.
