Fueling progress: Lebanon and Iraq sign agreements to boost electricity sector

Fueling progress: Lebanon and Iraq sign agreements to boost electricity sector

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2023-07-21 | 11:25

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Fueling progress: Lebanon and Iraq sign agreements to boost electricity sector

Lebanon and Iraq recently signed Memorandums of Understanding (MoU), amounting to a maximum of $1.8 billion, to facilitate the supply of crude and fuel oil to Lebanon's struggling electricity sector.

The agreements were signed during a meeting between Lebanese Energy Minister Walid Fayyad and Iraqi Oil Minister Hayan Abdul Ghani in Baghdad.

The expected quantities of crude oil and fuel oil are set at 3 million tons and 500,000 tons, respectively, and will be allocated for the benefit of Electricité du Liban (EDL).

The first MoU pertains to extending an existing fuel oil supply agreement, which was set at 1 million tons annually but has now been increased to 1.5 million tons per year. Lebanon will cover the cost of this quantity through services, goods, and other means.

The second MoU outlines a new agreement under which Iraq will supply Lebanon with 2 million tons of crude oil annually, amounting to a financial value of $1.2 billion.

These MoUs are expected to transition into formal contracts in the upcoming weeks. Lebanon hopes that this increased fuel supply will contribute to raising the daily electricity supply to 10 hours, alleviating the current severe