ERBIL, Kurdistan Region — Iraq is repaying half a billion dollars to Iran for its electricity debts, an official from Tehran said, still owing $800 million to the Islamic Republic.
Iraq will pay $500 million to Iran within the next two weeks, Iran's deputy minister Houshang Falahatian of energy told state-run IRNA news on Monday.
Falahatian also said that Baghdad still owes $800 million for debts it has accrued over the past four months, but that Iran will continue to supply electricity to the Iraqi grid.
Iran suspended power supply to Iraq in January after a contract with the Arab neighbor ran out at the end of last year, Iran’s Financial Tribune reported.
Iran's Energy Ministry said last year that Iraqi authorities had agreed to clear the debt by paying $100 million a month. However, after three installments, they started to procrastinate, according to the Tribune.
Last month the two neighbors finalized a gas exporting project totaling $3.7 billion anually. Per the agreement, Iran initially will send approximately 7 million cubic-meters (mcm) of natural gas to Iraq per day, eventually increasing to 35 mcm. The reported hold-up was Baghdad's inability to pay.
The average Iraqi household receives power for just 7.6 hours a day, according to recent data from a report by the Iraq Energy Expo. As a result of the shortfall, homes have to obtain half their power needs from generators.
Though Iraq is a major OPEC oil producer, the country has been incapable of meeting its residents' electricity consumption. Iraq's peak electricity demand was 21,000 megawatts in the summer and the grid is only able to supply about 13,000 megawatts, Reuters reported last year.
Iraq’s electrical grid has been further weakened during the three-plus year with ISIS.
Iraq will pay $500 million to Iran within the next two weeks, Iran's deputy minister Houshang Falahatian of energy told state-run IRNA news on Monday.
Falahatian also said that Baghdad still owes $800 million for debts it has accrued over the past four months, but that Iran will continue to supply electricity to the Iraqi grid.
Iran suspended power supply to Iraq in January after a contract with the Arab neighbor ran out at the end of last year, Iran’s Financial Tribune reported.
Iran's Energy Ministry said last year that Iraqi authorities had agreed to clear the debt by paying $100 million a month. However, after three installments, they started to procrastinate, according to the Tribune.
Last month the two neighbors finalized a gas exporting project totaling $3.7 billion anually. Per the agreement, Iran initially will send approximately 7 million cubic-meters (mcm) of natural gas to Iraq per day, eventually increasing to 35 mcm. The reported hold-up was Baghdad's inability to pay.
The average Iraqi household receives power for just 7.6 hours a day, according to recent data from a report by the Iraq Energy Expo. As a result of the shortfall, homes have to obtain half their power needs from generators.
Though Iraq is a major OPEC oil producer, the country has been incapable of meeting its residents' electricity consumption. Iraq's peak electricity demand was 21,000 megawatts in the summer and the grid is only able to supply about 13,000 megawatts, Reuters reported last year.
Iraq’s electrical grid has been further weakened during the three-plus year with ISIS.
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