Iraq and French oil major TotalEnergies (TTEF.PA) on Monday signed a long-delayed $27 billion energy deal that aims increase oil production and boost the country's capacity to produce energy with four oil, gas and renewables projects.
Signed in 2021, the deal has faced delays amid disputes between Iraqi politicians over the terms, but was finally closed in April when Iraq agreed to take a smaller than initially demanded stake in the project of 30%.
TotalEnergies took a 45% stake and QatarEnergy holds the remaining 25%.
TotalEnergies Chairman and CEO Patrick Pouyanne signed the agreement with Iraqi oil minister Hayan Abdel-Ghani at a ceremony in Baghdad, with Pouyanne calling it a "historic day".
Pouyanne said the project would break ground this summer and would see an investment of $10 billion over the next four years.
"This is the starting day, and we'll deliver the project in the next four years for the benefit of everyone in Iraq," he said.
The Gas Growth Integrated Project (GGIP) aims to improve the country's electricity supply, including by recovering flared gas at three oilfields and using the gas to supply power plants, helping to reduce the country's import bill.
TotalEnergies said it would also develop a 1 GW solar power plant to supply electricity to the Basra regional grid, inviting Saudi company ACWA Power to join the project.
"It is the real beginning of investment in renewable energy in Iraq," Abdel-Ghani said of the solar project.
The GGIP also includes the establishment of a seawater treatment plant that will enable drought-stricken Iraq to use seawater in the water-intensive oil production process instead of limited freshwater from rivers and marshes.
