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Iraq $1bn gas plant to complete in October

15 September 2023

Iraq is planning a large ceremony that is expected to take place in October to mark the mechanical completion of the $1.07bn gas processing plant project at the Halfaya field, according to industry sources.

The facility is on course to reach mechanical completion in early October, with full commissioning expected to occur over subsequent months.

One source said: “The completion of this project is considered a major milestone by the Iraqi authorities.

“The facility will process large quantities of natural gas, which will provide significant benefits to the country, which is currently reliant on Iran for gas imports.”

The gas processing plant project at Halfaya was delayed due to Covid-19 pandemic-related issues.

In April 2019, China Petroleum Engineering & Construction Corporation (CPECC) announced it had been awarded the contract to build and operate the facilities to process natural gas extracted alongside crude at the Halfaya oil field.

CPECC signed a $1.07bn engineering, procurement, construction, commission, operations and maintenance (EPCCOM) contract for the plant with Iraq’s Oil Ministry on 29 July 2019 – just four months before the first case of Covid-19 was recorded.

The project was initially scheduled to be completed in 30 months.

One source said: “Although this project has been completed slightly behind the original schedule, it is remarkable that it is on course to be completed in less than five years – considering the significant disruption caused by the pandemic.”

CPECC is affiliated with China National Petroleum Corporation. The plant it is developing is expected to process around 300 million standard cubic feet a day of natural gas extracted alongside crude oil at the field.

Under the existing contract, CPECC will operate and maintain the facility for two years after completing the EPC work.

Speaking in June, Iraq’s Minister of Oil Hayan Abdul-Ghani said Iraq aims to meet its internal gas demand without imports within five to seven years.

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Wil Crisp

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