Turkmenistan and Iran have signed a contract for the annual supply of 10 billion cubic metres of Turkmen gas, which Iran will transfer to Iraq under the SWAP programme, Trend reported.

The agreement was announced by Turkmenistan’s Foreign Ministry, but the monetary value of the contract was not disclosed. The agreement is the result of years of cooperation between Turkmenistan and Iran in the gas sector.

According to the ministry’s statement, Iranian companies will build a new 125-kilometre pipeline to Iran to increase gas supplies from Turkmenistan.

Ashgabat plans to increase gas supplies to Iran to 40 billion cubic metres per year in addition to the existing capacity. It is planned to increase the volume of gas supplied through Dovletabad-Serakhs-Hangeran and through the Chaloyuk gas metering station.

The agreement on gas supplies to Iraq was signed by Iranian Ambassador to Turkmenistan Ali Mojtaba Rouzbahani and President of the State Company “Turkmengaz” Maksat Babayev.

Based on the swap agreement (SWAP) between Turkmenistan and Iraq, Iran will supply up to 10 billion cubic metres of gas to Baghdad in exchange for the same amount of gas from Ashgabat.

Last year, Iraq faced disruptions in the supply of Iranian gas, which accounts for about 40 per cent of its imports.

Turkmenistan relies heavily on exports of its vast natural gas reserves. China is the main consumer of Turkmen gas and work is underway on a pipeline to supply gas to Afghanistan, Pakistan and India.