Iraq’s oil production reached 3.2 million barrels per day (mbpd) this past August – nearly 1 mbpd more than it was a year ago. That growth is set to continue: Iraq, home to the world’s fourth largest proven petroleum reserves, plans to ramp up production to 10 mbpd in six years. Given that 95 percent of Iraq’s state revenue comes from oil, that industry is key to the nation’s post-war rebuilding.
However, the flip side of Iraq’s growing oil output has been a nearly uncontrolled burning of “associated gas,” which is raw natural gas released as a by-product of petroleum extraction. Natural gas is often found in oil wells, where it is either dissolved in crude oil or exists separately in a form of a cap on top of the oil.
Unless it can be captured and used for commercial purposes, associated gas is burned off upon reaching an oil well surface, or it can be directly vented into the atmosphere without burning. Because methane is a key component of associated gas, venting of gas deposits large volumes of methane into the atmosphere, while burning it releases carbon dioxide. Thus, gas flaring is a source of greenhouse emissions and also carries the cost of wasting a valuable energy resource and degrading air quality.
Iraq currently ranks among the world’s top five flaring countries, according to the World Bank. As the second largest producer of oil in OPEC, Iraq flared around 9 billion cubic meters of associated gas in 2011. According to some estimates, the southern oil fields of Rumaila, West Qurna and Zubair account for over 25 million cubic meters of gas per day.
The World Bank says that the gas flared in Iraq, which amounts to $5 million per day in lost energy, would be sufficient to cover all of the country’s electricity demand. Faced with electricity supplies available only a few hours a day and with shortages of clean cooking fuels, Iraq’s flaring of associated gas is a colossal waste of a precious resource. In fact, flared gas would be sufficient to cover all of Iraq’s electricity demand.
The practice of burning gas is a matter not only of energy use, but also of public health and the environment. Residents who live near oil fields have complained of asthma, irritated skin and other problems. Aside from methane, flaring gas produces nitrogen oxide, sulfur dioxide, and other emissions that can affect vegetation and watershed.
The natural gas sector in Iraq lags behind its well-developed oil industry and, thus far, attempts to capture associated gas have been limited. Last year, Iraq’s Basrah Gas signed a landmark agreement with Royal Dutch Shell* and Mitsubishi to capture associated natural gas from southern oilfields and use it to fuel power stations and as feedstock for the petrochemical industry of this war-torn nation. The project aims to harness 2 billion cubic feet per day of natural gas by 2017.
This amount is just a small fraction of the gas flared in Iraq last year, however, and Iraq’s oil production stands to increase dramatically over the next two decades. With a glut of natural gas keeping prices down, Iraq has limited incentive to focus on the potential of capturing and exporting gas while its focus is on growing oil production. As Robert Lesnick of the World Bank has noted, “The savings from shifting from liquid fuels to gas for Iraq’s power generation is estimated at several billion dollars per year, but this benefit is less than one week’s increase in revenues from targeted incremental crude oil sales.”
According to the World Bank’s Global Gas Flaring Reduction partnership, Iraq has made flare reduction a priority in its energy policy and has launched a gas pricing study. Already, potential customers are waiting: Turkey and Jordan have reportedly expressed interest in gas imports from Iraq. It remains to be seen whether these developments will be enough to significantly reduce the amount of wasted natural gas now pouring into Iraq’s air.
*Shell is sponsor of The Great Energy Challenge. National Geographic maintains autonomy over content.