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France’s TotalEnergies has signed four major contracts with Iraq as part of the $27bn Gas Growth Integrated Project (GGIP), according to a statement released by the country’s Oil Ministry.

TotalEnergies chairman and CEO Patrick Pouyanne signed the contracts with Iraqi Oil Minister Hayan Abdel-Ghani at a ceremony in Baghdad, with Pouyanne calling it a “historic day”.

The long-delayed deal was originally signed in 2021 and involves TotalEnergies developing four energy projects with an initial investment of $10bn in southern Iraq.

The four contracts are focused on:

• The common seawater supply project (CSSP)
• A project to gather associated gas from oil fields
• A project to develop the Artawi field (also known as the Ratawi field)
•  The establishment of a 1GW solar energy project for the Electricity Ministry

Previously, one of the key sticking points was Iraq’s demand for a 40 per cent share of the project.

Ultimately, this was resolved, with Iraq accepting a 30 per cent share.

TotalEnergies took a 45 per cent stake and QatarEnergy holds the remaining 25 per cent.

Pouyanne said work on the contracts will break ground this summer and will see an investment of $10bn over the next four years.

“This is the starting day, and we’ll deliver the projects in the next four years for the benefit of everybody in Iraq,” he said.

Pouyanne added: “I hope that this will be a strong signal to other investors to come to Iraq.”

Exxon Mobil, Shell and BP have all scaled back their operations in Iraq in recent years, contributing to a stagnation in oil production. Iraq’s oil production capacity has remained at about 5 million barrels a day in recent years.

The gas gathering project aims to improve the country’s electricity supply, including by recovering flared gas at several oil fields and using the gas to supply power plants, helping to reduce Iraq’s import bill.

The fields that gas will be gathered from are:

• West Qurna 2
• Majnoon
• Artawi
• Tuba
• Luhais

The facility is expected to process 300 million cubic feet a day (cf/d) of gas and double that after a second development phase.

Large gas volumes are flared from these fields, causing significant environmental damage.

Collecting and processing this gas will generate increased hydrocarbons revenues and reduce environmental damage. The planned central gas complex will be located in Artawi.

The gas processing project will supply Iraq’s national gas network to generate electric power and increase the production of gas products, including liquefied petroleum gas (LPG) and condensate.

Under the terms of the development contract for the Artawi field, production will be ramped up to 120,000 barrels a day (b/d) in two years and then to 210,000 b/d within four years.

The CSSP is strategically important as it will address water shortages in Basra that are fuelling political instability and provide water for injection into oil fields to boost production at ageing fields.

The CSSP has seen significant delays since it was first announced in 2011 and has stalled in recent years.

In January 2021, MEED revealed that Iraq’s state-owned BOC had revived the dormant project, asking contractors to submit commercial bids for the main pipeline package, estimated to be worth about $1.5bn.

The Oil Ministry said that Total agreed to ensure that the CSSP would have the capacity to transport 2.5 million barrels of water a day once the initial phase had been completed.

It said that the project was “one of the most important projects with regard to sustaining production in the oil fields”.

Commenting on the solar project, Abdel-Ghani said: “It is the real beginning of investment in renewable energy in Iraq.”