Turkmenistan and Iran sign deal to supply gas to Iraq. Iran will build pipeline to aid delivery

ASHGABAT, Turkmenistan -- ASHGABAT, Turkmenistan (AP) — Turkmenistan and Iran on Wednesday signed a contract for the delivery of 10 billion cubic meters a year of Turkmen gas that Iran will then ship on to Iraq.

The deal was announced by Turkmenistan's foreign ministry, which did not state the monetary worth of the contract.

The ministry's statement said Iranian companies will construct a new 125-kilometer (77-mile) pipeline to Iran to expand Turkmenistan's delivery capacity. The ministry said Turkmenistan plans to increase its gas supplies to Iran to 40 billion cubic meters a year.

Iraq last year faced disruptions in the supply of Iranian gas, which accounted for about 40% of its imports.

Turkmenistan is heavily reliant on revenue from sales of the gas in its vast reserves. And the government was instructed to find alternative options to ensure the operation of power plants in the central and southern provinces of the country.

The former Soviet republic of Turkmenistan relies heavily on the export of its vast natural gas reserves. China is the country's main customer for gas and Turkmenistan also is working on a pipeline to supply gas to Afghanistan, Pakistan and India.