The project involves building a large-scale seawater treatment facility to improve output from other fields using water injection, a huge solar power plant in the Basra area, and a natural gas gathering network.
The CEO of Iraq’s Basra Oil Company (BOC) anticipates Qatar will purchase a 20–25% stake in TotalEnergies’ TTEF, reported Reuters.
Bassem Abdul Karim’s expectations are relatively lower than what QatarEnergy was aiming for, with earlier reports suggesting a 30% stake in the project.
“Qatar is one of the promising and developed countries in this regard…we determine our percentage as an Iraqi country, and the rest is for Total and QatarEnergy…I don’t expect more than 20-25%, they are talking about 30%,” said Abdul Karim told Reuters, referring to Qatar’s potential stake.
“The important thing for us is to set our share…Iraq is talking about 40%,” noting talks are ongoing.
Baghdad is keen on preventing western energy corporations from leaving the country, and a significant investment by a Gulf nation would be seen as a victory for Iraqi Prime Minister Mohammed Al-Sudani, who was elected in October after more than a year of political unrest.
International oil corporations have been attempting to depart Iraq as a result of the low returns from revenue sharing agreements after a rush of negotiations that followed the US invasion more than ten years ago.
Hopes for a reverse of the outflow were high when TotalEnergies and Baghdad inked a contract in 2021 to construct four enormous solar, gas, power, and water projects in southern Iraq over a 25-year period.
In recent years, Exxon Mobil, Shell, and BP have all sought to curtail their operations in Iraq. However, the initiative, designed to strengthen the nation’s economy and lessen its reliance on Iranian gas, has yet to start.
Additionally, such an investment by a Gulf Arab country would be seen as a step against Iranian influence in the region.
Abdul Karim expressed his expectation that the contract, which was signed in 2021 and calls for a $10 billion initial investment to create four enormous solar, gas, power, and water projects in southern Iraq over a 25-year period, would be activated within three months.
The agreement between TotalEnergies and Iraq, which calls for a $10 billion first investment, came after a trip by French President Emmanuel Macron in September 2021.
Reuters reported in February 2022 by sources close to the transaction that the terms of the agreement, which have not been made public or previously disclosed, had alarmed Iraqi lawmakers and were unprecedented for Iraq.
The agreement calls for building a large-scale seawater treatment facility to improve output from other fields using water injection, a huge solar power plant in the Basra area, and a natural gas gathering network to serve local power plants through the extension of the Ratawi field.
However, not much has changed since then. Last year, sources told Reuters that disagreements over the parameters could have led to the project’s cancellation.
In order to support Baghdad, which has experienced issues like Islamic State militants, climate change, corruption, and instability since the 2003 US-led invasion, Iraq and France jointly organised a meeting in Jordan in December.
Middle East rivals Saudi Arabia and Iran joined Qatar in attendance, though the kingdom is one of the Arab countries that has been keen on doing away with Tehran’s influence in Iraq.