The Ministry of Electricity in Iraq has been given permission by the Council of Ministers to sign a swap agreement with the Swiss company Loxstone Energy to get gas from Turkmenistan to Iraq through Iran.
The deal is exempt from the Government Contracting Instructions, the Federal Budget Law, and the Budget Implementation Guidelines because of the contract’s significance and urgency for power plant maintenance.
A memorandum of understanding was previously signed with the Turkmen state-owned gas company [Turkmengaz] in response to Council of Ministers’ Decision No. 23519 of 2023.
The Turkmen gas company needed a prepayment method, and the Cabinet approved it. The Ministry of Finance made sure the money was there when it was needed. Fees and taxes will be paid by the government organization.
It also approved a “similar to the Iranian gas contract” exemption from the performance bond, with payments made via transfers to the Turkmen gas company and Loxstone Energy, in accordance with the Trade Bank of Iraq (TBI) recommendation.
The Public Debt Collection Law will not apply to the contract; The contract draft will be based on the sole bid that was received, and it will be governed by Swiss law.
