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Iraq awards foreign firms $1.3 billion power plant contracts

Contracts worth about $1.3 billion to build new power plants in Iraq and overhaul existing ones have been awarded to foreign firms, including an Iranian company, Iraq’s electricity minister said Thursday.

“The Ministry of Electricity sealed contracts with American, British, German, Finnish, Italian, Iranian and Chinese firms to build new power plants with different production capacity in several Iraqi cities,” the Minister of Electricity Karim Wahid told Deutsche Presse-Agentur dpa. Iraq is seeking to bridge shortages in power output and more contracts are now under consideration, he said.

The biggest contracts were awarded to Chinese firms, to build power plants and upgrade old ones across Iraq. The value of the contracts is worth $970 million. An Iranian firm will build a $122 million power plant in Baghdad’s predominantly Shiite district of Sadr City. Projects worth about $192 million are to be carried out by European firms across the country. A US company is to build a power plant in the southern city of Najaf, the minister said without stating the value of the project. The names of the companies have not been disclosed, although Chinese firm Shanghai Heavy Industries is believed to be among these.

The Ministry of Electricity is studying contracts to build more power plants in Karbala and other cities, Wahid said. Experts have warned that Iraq’s power grid risks collapsing mainly because of insurgent sabotage, fuel shortages, rising demand, and provinces unplugging local power stations from the national grid. Frequent blackouts and regular power cuts in many areas are a fact of life in the oil-rich country. Power shortages are a huge source of disgruntlement in the country where many put the problem ahead of crimes as a major priority that the government needs to tackle. The total output of all power plants connected to the national grid is estimated to be about 5,000 megawatts. (m&