Siemens, Orascom Construction Set to Reconstruct Huge Iraq Power Plant

Iraq has announced that it has signed a USD 1.3 billion deal with Siemens and Egypt's Orascom Construction to reconstruct a major power plant complex in the emaciated city of Baiji, north of Baghdad.

The new deal is part of a wider energy road map that Iraq signed with Siemens previously this year in a bid to pump 11 gigawatts into Iraq's crippled power sector.

The country presently generates around 15 GW, far short of projected demand of about 24 GW.

The Baiji 1 and 2 plants, as well as a massive oil refinery nearby, were destroyed in the three-year fight against the Islamic State group after it swept across a third of Iraq in 2014.

Many of Baiji's neighborhoods remain reeling, neighboring fields are beleaguered with unexploded ordnance and the area is controlled by a complex web of paramilitary groups.

Iraqi electricity minister Luay al-Khateeb signed the deal in Baghdad with Siemens CEO Joe Kaeser and Orascom chief Osama Bishai.

"This agreement worth USD 1.3 billion will add up to 1.7 GW to the grid," Khateeb told reporters.

Siemens said the plant renovation would take about 28 months, starting once the Iraqi cabinet approves the contracts and a financing agreement is reached.