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When Iraq published its detailed Integrated National Energy Strategy (INES) in June last year, it anticipated the phasing out of gas flaring in 2015 and surplus gas production from 2016. Neither of these targets is remotely possible.
The development of non-associated gas is being held back by the current crisis in the west and northwest of the country, while associated gas output in the south has been on the rise in tandem with crude oil increments, with barely a dent being made in reducing the amount of gas burned into the atmosphere.
NICE PLAN, LITTLE ACTION
The Iraqi Oil Ministry, acting on INES recommendations, commissioned an independent study for development of a Gas Master Plan, which was presented to senior officials this year. A copy of the comprehensive presentation made at a workshop held in Basra earlier this year has been seen by MEES. Its recommendations take as a template the wider energy goals set out in the INES report and contain a global gas market overview and comparisons with the various paths adopted by other Middle Eastern gas players, such as Qatar, the UAE, Saudi Arabia, Iran, Oman and Egypt to monetize their gas reserves. The problem is that while Baghdad is exploring various options of exploiting its 112 tcf of natural gas reserves, it cannot hope to meet any of its goals – never mind cashing the $200bn 2015-30 check that the study says monetizing Iraq gas reserves would bring – unless it lays the building blocks immediately, the report says.
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