Iran receives $1.6B in gas debt from Iraq

A gas flare on an oil production platform is seen alongside an Iranian flag. (Reuters)

Iran has received $1.6 billion in arrears from the Iraqi government for imports of natural gas, Oil Minister Javad Owji announced late Wednesday. 

In a Twitter post, Owji said the debt from previous years was received "a few hours ago" following "several months of negotiations" between the two sides, crediting it to "active energy diplomacy.”
 
"Since the beginning of the year, compared to last year, the country's gas export volume has increased by 25 percent and and the collection of revenues has also increased by 90 percent," Owji added.

According to officials, more than $5 billion in funds remains frozen in Iraq from exports of gas and electricity as a result of US sanctions.

Iraqi Ministry of Electricity had announced the start of the process of paying the Iranian gas debt while confirming that Iraq's need amounts to more than 50 million cubics daily.

The Iraqi government started Wednesday to pay the Iranian gas dues, which are late for the year 2020, via internal borrowing from the Trade Bank of Iraq, and the Ministry of Finance deposited the money in the Credit Fund.

Despite its large oil and gas reserves, Iraq remains heavily dependent on Iran for its energy needs, with the neighboring country providing a third of Iraq's gas and electricity supplies.



PUKmedia