Iraq's ministry of electricity says Iraq has signed an initial agreement with the Islamic Republic to import 25 million cubic meters of natural gas a day for power generation, Press TV reported.
A spokesman for the Iraqi ministry of electricity said on Sunday that under the terms and conditions of the memorandum of understanding, Iraq will buy the Iranian natural gas on a five-year deal, Reuters reported.
Mosaab Serri noted that Iran will install a pipeline through Iraq to supply the country with the needed natural gas to feed Sadr and al-Quds power plants near Baghdad, generating about 2,500 megawatts of electricity.
The pipeline, which is planned to come on stream within 18 months, will pass the Mansouriya gas field near the Iranian border in the Iraqi province of Diyala.
The agreement needs to be officially ratified by the Iraqi cabinet and parliament.
Earlier in the week, Chairman of Iran's Gas Transportation Company Reza Almasi said that Iran's natural gas distribution network is the fourth-largest in the world.
"Iran stands second in the world in terms of natural gas reserves and ranks fourth in natural gas distribution network after Russia, the US and Canada," said the official.
Iran sits on the world's second-largest natural gas reserves after Russia and has also sought to promote itself as a transit route for oil and gas from Central Asian states.