Iran Gas Exports to Iraq Delayed Again by Security Concerns

Iran gas exports to Iraq delayed again by security concerns

Iran's plans to export natural gas to Iraqhave been pushed back indefinitely, an Iranian official was quoted as saying,blaming the poor security situation in Iraq for the delay.

The oil-producing neighbours signed anagreement in 2013 under which Iran would start exporting gas to Iraq to feedthree power plants in Baghdad and Diyala. But two years later, exports havestill not begun.

"The lack of security and presence ofDaesh (Islamic State) is behind the delay of gas exports to Iraq,"Ali-Reza Kameli, head of the National Iranian Gas Exports Company, was quotedas saying by Shana, a news agency linked to Iran's Oil Ministry.

When asked when exports might begin, hereplied: "That depends on the security situation in Iraq."

In March Kameli said exports to Iraq couldbegin in May if security conditions improved. Iran first announced a delay inSeptember last year, shortly after Islamic State militants took control oflarge swathes of Iraqi territory.

Iran has huge gas reserves and exports smallquantities to Turkey, but production has failed to keep pace with high domesticconsumption. Northern Iran relies heavily on gas imports from Turkmenistan,especially for heating in winter.

Tehran is in talks with six world powers tocurb its nuclear programme in exchange for relief from international sanctions,which could open up Iran's energy sector to foreign investment within a year.

Iraq, which like Iran is a major oil producerand member of the Organization of the Petroleum Exporting Countries (Opec), hasstruggled to attract foreign investment to develop its gas industry and sufferssevere power shortages.

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