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French oil and gas company TotalEnergies has begun building a gas processing facility in Iraq, the first stage of a massive multi-energy project. ArtawiGas25 will process 50 million cubic feet of gas per day from the Ratawi field, enough to supply local plants to power 200,000 households in the Basra region.
Back in May, TotalEnergies reached an agreement with the government of Iraq to start working on the delayed $27 billion energy project. Total first signed a deal with the Iraqi government in 2021 that would see Total build four oil, gas and renewables projects in southern Iraq over 25 years with an initial investment of $10 billion. Unfortunately the giant project was shelved amid disputes and squabbling between Iraqi politicians over terms of the deal. However, Iraq finally agreed to a smaller 30% stake in the project, setting in motion a deal that could lure foreign investment back into the country. In recent years, Exxon Mobil, Shell Plc. and BP Plc. have all scaled back their operations in Iraq, contributing to a stagnation in oil production after years of instability. However, Iraq has been enjoying a period of relative stability, increasing the chances of foreign investors returning to the country.
“The government of Iraq confirmed the whole contract, no modification at all … so that was for me more than good news,” Total Chief Executive Patrick Pouyanne has told Reuters.
Meanwhile, Iraq could resume oil exports via a pipeline to the Turkish port of Ceyhan on the Mediterranean coast. Export flows to Turkey’s Ceyhan port are yet to restart after Ankara halted Iraq’s 450,000 barrels per day (bpd) of exports through the Iraq-Turkey pipeline on March 25 following an ICC ruling that Turkey should pay Baghdad damages of $1.5 billion for unauthorized exports by the KRG. However, the Iraqi oil ministry, Kurdistan’s Ministry of Natural Resources and international oil companies met in June in Baghdad to discuss resuming production and exports.
