Iraqi Foreign Minister Fuad Hussein met with US Secretary of State Antony Blinken during an international conference on terrorism in Riyadh. According to a statement by spokesman Ahmed Al-Sahhaf, the talks were productive and led to significant payment arrangements for the gas debts Iraq owes Iran.
Iraq has been struggling to pay Iran for the gas imports used to fuel its power plants due to US sanctions. Iraq had built two pipelines in the last decade to import gas from Iran. The country's gas-fired power plants need between 55 million and 60 million cubic meters per day to operate at full capacity.
The debt owed by Iraq to Iran is estimated to be around $11 billion, according to Ahmed Moussa, a spokesman for the electricity ministry. To ease the situation, Iraq has already paid Iran €1.5 billion ($1.6 billion) since Prime Minister Mohammed Shia Al Sudani formed the current government in October 2020.
Further negotiations during the Riyadh meeting resulted in new payment arrangements to settle debts totalling billions of dollars. The talks were also attended by Oman's Foreign Minister Sayyid Badr bin Hamad Albusaidi, who was involved in discussions around the same issue.
While the details of the payment arrangements have not been disclosed, the discussions mark a significant step towards resolving the issue. The debt has been a major burden on Iraq's economy, which is already struggling with the effects of the COVID-19 pandemic and low oil prices. The payments will help ensure that Iraq continues to receive vital gas supplies from Iran to power its infrastructure and industries.