Shafaq News/ The US government isintensifying efforts to bring American companies into Iraq’s energy sector,seeking to surpass Chinese investors, reduce emissions from Iraq’s oil and gasproduction, and limit Iran’s influence, according to a report from the AmericanForbes magazine.
Geoffrey Pyatt, the StateDepartment’s Assistant Secretary for Energy Resources, emphasized Iraq’sstrategic importance, “Everybody recognizes the asset that Iraq represents,second largest proven reserves in OPEC,” he told Forbes. Iraq holds 145 billionbarrels of proven oil reserves, an amount expected to last about 100 years atcurrent production rates, according to World Bank estimates.
Since the US invasion in 2003, whichleft Iraq’s energy infrastructure severely damaged, the country has struggledto rebuild its electricity grid. Now, the Biden administration sees anopportunity to support Iraq’s pro-business Prime Minister Mohammed ShiaAl-Sudani in revitalizing the sector. “Two decades of American blood andtreasure are in Iraq, and we shouldn’t forget that,” Pyatt noted. “Now therelationship is shifting into a new phase.”
US-China Competition
Pyatt underscored that developingIraq’s energy system is also a chance to diminish China’s influence. “Unlikethe Chinese, who may have other motives, our companies will only get involvedwhere they see an asset and where there are options for recovery of capital,”Pyatt stated. China, already a key player in Iraq’s oil sector, secured bidsearlier this year to develop 10 additional oil and gas fields. Iraq sends 35%of its crude oil to China, with trade between the two nations reaching $50billion.
Despite China’s dominance, Pyattsaid he is not concerned about which country ends up buying Iraq’s oil. “Idon’t worry at all about the flag on the molecule. It’s a fungible andintegrated market,” he said.
Strengthening Bilateral Relations
Over the last six months, therelationship between the US and Iraq has strengthened, with U.S. officials andmajor American energy companies, such as GE, BP, and Halliburton, holdingseveral meetings with Iraqi counterparts. In October, the US Export-Import Bank(EXIM) announced a nearly $300 million deal with Iraq’s Ministry of Electricityto upgrade power plants. This initiative will raise Iraq’s power generationcapacity by 40%, while reducing greenhouse gas emissions by over 31%.
Pyatt highlighted Iraq’s efforts toaddress gas flaring, a major contributor to emissions, stating, “There are hugeopportunities under Al-Sudani to capture gas that’s currently vented at recordlevels.”
Climate and Energy Goals
In line with broader climateobjectives, the US is working with Iraq to reduce its environmental impact.Iraq’s Minister of Oil, Hayan Abdel-Ghani, aims to eliminate gas flaring by2028, a goal consistent with the Biden administration’s climate agenda.Additionally, Iraq plans to install rooftop solar systems on 500 publicbuildings, with $68 million set aside in the 2024 national budget.
While Iraq's oil production isexpected to grow, Pyatt emphasized the need to minimize the carbon footprint offossil fuel extraction. “We need to make sure we’re doing everything possibleto reduce the climate intensity of the fossil energy that the world doesproduce,” he said.
The US remains committed to ensuringIraq's energy development aligns with global sustainability goals, positioningAmerican companies to play a central role in Iraq's future energyinfrastructure.
Disclaimer: The views presented bythe author do not necessarily reflect the official standpoint of Shafaq NewsAgency.