The two companies have “signed a $250 million financing agreement with the U.S. International Development Finance Corporation (“DFC”) to support the gas expansion works currently under way at the Khor Mor gas plant in the Kurdistan Region of Iraq (KRI),” Dana Gas announced in a press release on Wednesday.
The seven-year financing support will support the increase “in gas production capacity by 50% to 690 million standard cubic feet (scf)/day to meet rising demand for clean natural gas for electricity generation and industry in the KRI,” added Dana Gas.
Kurdistan Region Prime Minister Masrour Barzani said he was "delighted" that Dana Gas secured the funding to expand Khor Mor. "This will increase our production of clean, cheap electricity; and create many jobs here in Kurdistan so we can build a better future for our homeland," he tweeted.
The Khor Mor field is jointly operated by Dana Gas and Crescent Petroleum on behalf of the Pearl Petroleum Consortium. They have been operating in the Kurdistan Region since the Kurdistan Regional Government (KRG) began producing oil and gas independently of Baghdad in 2007, and selling independently in 2013.
“DFC’s investment in the Khor Mor expansion will substantially increase access to energy for people all across the Kurdistan Region of Iraq. This highly developmental project represents the United States’ continuing investment in the KRI,” Dev Jagadesan, acting CEO of DFC, said.
In a press release in April, Dana Gas said it produces 440 million cubic feet per day and will invest further. The company also announced a nine percent natural gas production increase in the first quarter of 2021 in comparison to the same period last year.
In December, Dana Gas announced record high production in the Khor Mor plant, resuming expansion plans halted by coronavirus in March.
The KRG has struggled with economic woes for many years and has struggled to pay the oil companies operating in the Kurdistan Region. However, it has managed to pay the companies regular payments in recent months as the economic impact of COVID-19 lessens and oil prices increase.
Updated at 6:40 pm
