Siemens, Orascom to rebuild vast Iraq power plant
BAGHDAD, Sept 15, 2019 (BSS/AFP) – Iraq on Saturday signed a $1.3 billion
deal with German industrial conglomerate Siemens and Egypt’s Orascom
Construction to rebuild a major power plant complex in the ravaged city of
Baiji, north of Baghdad.
The new deal is part of a broader energy road map that Iraq signed with
Siemens earlier this year in a bid to pump 11 gigawatts into Iraq’s crippled
The country currently generates around 15 GW, far short of estimated demand
of about 24 GW.
The Baiji 1 and 2 plants, as well as a massive oil refinery nearby, were
destroyed in the three-year fight against the Islamic State group after it
swept across a third of Iraq in 2014.
Many of Baiji’s neighbourhoods remain gutted, surrounding fields are
littered with unexploded ordnance and the area is controlled by a complex web
of paramilitary groups.
On Saturday, Iraqi electricity minister Luay al-Khateeb signed the deal in
Baghdad with Siemens CEO Joe Kaeser and Orascom chief Osama Bishai.
“This agreement worth $1.3 billion will add up to 1.7 GW to the grid,”
Khateeb told reporters.
Siemens said the plant renovation would take about 28 months, starting once
the Iraqi cabinet approves the contracts and a financing agreement is
Iraq’s grid has been ravaged by decades of conflict and poor maintenance,
causing chronic power cuts across the country.
Iraq tops up its grid with electricity imported from neighbouring Iran, as
well as using Iranian natural gas to feed its power plants.
The US has granted Iraq a series of waivers from sanctions against Iran,
allowing it to keep up its imports — providing it works to wean itself off
US officials have urged Iraq to partner with American companies, including
General Electric, to gain energy independence.
Industry sources have criticised the move as putting unfair pressure on
Baghdad to favour US firms.
Kaeser on Saturday hinted that such pressure had eased and a “level playing
field” had been achieved.
“Time will tell, but otherwise somebody else would have been here signing
today,” he said.