Iraq has contingency plans for any stoppage of Iranian gas imports for its power grid but hopes no such disruption will take place, Oil Minister Thamer Ghadhban said on Thursday.
He also said a meeting of OPEC’s ministerial monitoring committee in Saudi Arabia this weekend would assess member states’ commitment to a deal reducing oil production and that oil prices and markets were now stable.
“It’s still too early to predict what will be decided,” Ghadhban told a news conference when asked whether the Organization of the Petroleum Exporting Countries and its oil-producer allies could extend the output cut or boost supplies.
The gathering on Sunday in Jeddah may issue a recommendation ahead of OPEC’s policy-making meeting with its allies next month in Vienna.
Turkey has asked to buy more Iraqi crude, Ghadhban added, speaking in Baghdad a day after Iraqi Prime Minister Adel Abdul Mahdi travelled to Turkey to meet President Tayyip Erdogan.
The United States is ramping up sanctions pressure on Iraq’s neighbour and ally Iran, especially over oil exports.
“Turkey has asked to increase its crude oil imports from Iraq and we have pledged to consider the Turkish request positively,” Ghadhban said.
Iraq relies heavily on gas from Iran for its electricity supply, which is stretched during hot summer months.
A lack of electricity was one complaint by protesters in demonstrations that descended into violence in Iraq’s oil hub of Basra last year.
Asked how Iraq would react if Iranian gas imports were halted, Ghadhban said: “We hope there will be no halt, but we have taken precautionary measures for such a situation.”
The United States is urging Baghdad to sign energy deals with U.S. companies, including a share for General Electric of a $14 billion power scheme that Washington says would help wean Iraq off Iranian energy.
Ghadhban said international oil companies were operating as normal. He added that oil fields in the south and north of the country were safe and secure amid increased tensions between Washington and Tehran.
The United States evacuated non-essential staff from its diplomatic missions in Iraq over unspecified threats from Iran on Wednesday.
Sources close to foreign oil companies denied reports they were also evacuating employees on Wednesday.
The Kerbala refinery in southern Iraq will start operating in 2022 with a production capacity of 150,000 barrels per day (bpd), Ghadhban said.
Iraq plans to build a refinery with a capacity of 150,000 bpd near the northern city of Mosul to refine heavy crude from the nearby Nejma and Qayyara oil fields, the minister said.
He was speaking on the sidelines of a signing ceremony for a $400 million investment contract with Iraq’s Al-Barham Group Co.
Under the deal, facilities will be built near the Kirkuk refinery to produce 12,000 bpd of high-octane gasoline and 160 tonnes of liquefied petroleum gas per day.