Energy market in Iraq

Iraq ranks among the top ten natural resources rich nations in the world. Iraq’s terrain holds petroleum, natural gas, phosphates and sulfur. Iraq is the second-largest crude oil producer in the Organization of the Petroleum Exporting Countries (OPEC). It ranks as the world’s fifth-largest holder of proved crude oil reserves. Iraq depends on the export of crude oil for 95% of its revenues.

Key opportunities for Canadian energy companies in Iraq

• Oil & Gas: Upstream, Midstream, Downstream
• Capturing & elimination of GHG-emissions
• Cleantech: Solar & renewable power projects

Notable challenges for Canadian energy companies in Iraq

• Government of Canada travel advisories
• Lack of EDC support, regulatory risks and bureaucratic hurdles
• Strong competition exists from US, UK, China, and other European countries

Iraq’s business landscape

Iraq has a young population with 60% of its 42+ million population being less than 22 years of age. It is a developing country and is encumbered by growing energy needs such as:

• Insufficient electricity generation and transmission capacity to meet demands
• High technical & commercial losses within the distribution network
• Reliance on fossil fuel (gas) imports from neighboring countries

Iraq has a gross Domestic Product (GDP) of over $264 billion, rising domestic energy consumption, a shortfall of at least 11-13 Gigawatts (GW) of production capacity and is continuously growing. For international investors, Iraq presents a land of opportunities, whether in oil and gas, renewable energy, or emissions capture projects.

Iraq's current primary energy mix comprises natural gas, heavy fuel oil and hydropower. Iraq plans to shift towards renewable energy for up to 50% of its energy generation by 2030.

International financial institutions like World Bank, IMF, UNDP are actively funding numerous solar, water/wastewater treatment and transmission upgrade projects across the country.

The main seaports in Iraq are located in Basra province (Um Qasser) in the south of the country. Also, the Al-Faw Seaport, a trade hub, is under construction.

In May 2023 the Iraqi Prime Minister announced “The development road or the dry canal” project. This Iraqi project links between Türkiye in the north and the Arabian Gulf in the south to transport goods between the Gulf and Europe by rail and roads. The project will serve the region economically and will transport goods from Europe to the Gulf and vice versa through Iraq. The project costs total 17 billion US dollars and will be completed in record time, beginning  in 2024 thru 2028.

Upcoming projects and events

• Oil and Gas: drilling, new pipelines & rehabilitation of existing ones, refineries & petrochemical projects
• Emissions capture / carbon & methane economics
• 4x 700MW Renewable energy projects with Ministry of Energy
• Vocational training and High education (MSc & PhD)
• 47^th Baghdad International Fair, 1^st – 10^th  November 2023
• 9^th Iraq Energy Exhibition & Conference, 12^th -14^th  February 2024
• 2^nd Petroleum Exhibition & Conference, 10^th -13^th  September 2024

Summary

Iraq is an attractive market for foreign investment and offers rich geological potential and massive opportunities. The Iraqi market presents huge potential for Energy & Cleantech business development.

For more information on Oil & Gas and or Cleantech in the Iraqi market, please contact Trade Commissioner, Ali Aziz

Ali.Aziz@international.gc.ca