Natural gas in Iraq has been in deterioration for a long duration. Two huge processing plants and connected pipelines were developed in 1980s. These were extremely affected by wars and sanctions and lack of maintenance, investment and rehabilitation. The condition existed in high degree since 2003. The attention was on the flow of businesses with international oil companies with not much attention to the downstream sector.
In reading the ‘Iraq Energy Outlook’ of International Energy Agency (IEA) one finds out the ascending battle to gain an amount of success in utilizing this essential resource and the restricted time frame obtainable to refrain from further extreme losses. The IEA makes a calculation that in June 2012 the gas flared was 1043 million cubic meters (mcm) out of the total production of 1988 million cubic meters or nearly 52.50 per cent. But at the same time the power production industry is working with liquid fuels like crude oil and imported gas oil. The greatest quantity of the flared gas is in the southern Iraq for the lack of minimum maintenance and restoration of the South Gas processing opportunities and the national gas which are not finished convey to further north and Baghdad.
About a year ago, the Basra Gas Company set up a joint venture with Shell and Mitsubishi. The working power in the south is adequate for all the recent gas production if accurately maintained and rehabilitated to generate about 10 billion cubic meters (bcm) per year. The condition does not be a good with the impending growth in crude oil generation and the increasing production of connected gas. In the IEA most important outline where crude oil production extends to 6.1 million barrels per day in 2020 and in the south gas production is supposed to attain 29 bcm. That means the recent processing power must be tripled. The working enlargement in the other part of the country is essential but much more manageable. If Iraq chooses or organize to go for greater crude oil production, the working power in the south must be developed by four-and-half-fold.
In both instances, this is a difficult task because of the time required and the magnitude of the investment to set up the method of gas processing, gathering, and transmission. The IEA is announcing that “the cumulative volume of gas flared during the years 2012-2020 in the Central Scenario is about 110 bcm; in the High Case, it is close to 160 bcm.”
This is equal in value of 726 and 1056 million barrels of oil. The IEA expresses “If this gas were to be substituted for oil in Iraq’s power generation, allowing the oil to be exported, the implied value of this flared gas is $70 billion in the central scenario and more than $100 billion in the high case.” Including all this to the previous years’ losses remind of those who were so fast to award the most excellent of Iraq oil plants to international oil fields without taking any authority for the produced gas. Basra Gas Company may take responsibility of the generated gas from Zubair, Rumaila and West Qurna I oil fields. But who will take care of the gas produced from other equivalent fields like Halfaya, Majnoon, West Qurna II and others?
Many Iraqi oilmen are in favor of making bigger the resources of free gas fields that are included in the calculation to the considerable sum of 20 to 30 per cent. These oil fields should not be prepared as long as there is associated gas available for using. At the same time, there must be an investigation on the possibility of using these fields for gas storage. There must be given importance on the gas storage of Janbor and Ajil as this is an easy process to refrain from flaring.
There is immediate requirement for new ideas of quickly collected smaller gas fields that may not completely process the liquids but preserve the dry gas and permit the liquids to be sent until the enormous gas complexes are created. Taking into consideration these latent losses, Iraq must stop at nothing to associate with this condition. The time of being concern with oil and flaring the gas is passed and it is the same for Iraq.
Source [Gulf News]