Pearl Petroleum Company Limited (“Pearl Petroleum”), the consortium led by Dana Gas and Crescent Petroleum of the UAE, has signed a $250 million financing agreement with the US International Development Finance Corporation (DFC) to support the gas expansion works at Kurdistan’s Khor Mor gas plant, according to a press release issued by DANA GAS.
The proceeds from the 7-year DFC financing will support an increase in gas production capacity by 50% to 690 million standard cubic feet per day (scf/d) to meet rising demand for clean natural gas for electricity generation and industry in the Kurdistan.
Considering that the total project cost is $630 million, a regional bank facility and the EPC contractor have secured the remaining financing. The expansion activities resumed in April 2021 after onsite construction was halted last year due to the COVID pandemic. It is also worth noting that the KM-250 project is the first stage of a two-train expansion project at Khor Mor that aims to boost total production capacity to approach 1 billion scf/d.
On this occasion, Majid Jafar, CEO of Crescent Petroleum and Board Managing Director of Dana Gas, commented: “This financing agreement with DFC underscores the importance of developing the natural gas resources in the KRI to support regional economic development and growth. Despite the global challenges presented by the COVID pandemic, we have continued to maintain our record of uninterrupted operations and even managed to grow production.”
Dr. Patrick Allman-Ward, CEO of Dana Gas, added: “With our partners in Pearl Petroleum we are proud to be further developing the gas sector of the Kurdistan Region of Iraq, delivering expanded supply of cleaner energy, and supporting local economic development. This agreement underscores our continued confidence in the region and its long-term prospects.”
For his part, Mr. Dev Jagadesan, Acting CEO of DFC, said: “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.”