Excelerate Energy, a Texas-based liquefied natural gas (LNG) company, has secured a contract worth approximately $450 million to develop and operate Iraq’s first floating LNG import terminal, reports Offshore Energy.
The agreement, signed with a subsidiary of Iraq’s Ministry of Electricity, marks a major step in the country’s efforts to diversify its energy imports and strengthen power generation infrastructure. The terminal will be located at the Port of Khor Al-Zubair in southern Iraq, a key maritime hub near Basra.
US firm lands $450 million job
Under the five-year agreement, Excelerate Energy will supply and regasify LNG for Iraq, with an initial contracted volume of 250 million standard cubic feet per day (MMscf/d). The facility is designed to handle up to 500 MMscf/d of regasification capacity, ensuring flexibility to meet rising domestic power demand. The company will deploy its newest Floating Storage and Regasification Unit (FSRU), currently under construction by HD Hyundai Heavy Industries in South Korea. The vessel, named *Hull 3407*, will have a storage capacity of approximately 170,000 cubic meters and a peak regasification rate of about 1 billion standard cubic feet per day.
Operations at the new terminal are expected to begin in 2026, following construction and regulatory approvals. Once operational, the project will enable Iraq to import LNG from global suppliers, reducing its long-standing dependence on pipeline gas imports from Iran. This shift is particularly significant for Iraq’s power sector, which has faced frequent blackouts due to inconsistent gas supplies and high seasonal demand.
For Iraq, the floating terminal represents a cost-effective and rapid solution compared to traditional onshore LNG infrastructure. It will also give the country greater flexibility to source LNG cargoes on the international market, improving energy security and supporting economic stability. The project aligns with Baghdad’s broader goal of diversifying energy partnerships and attracting foreign investment into non-oil infrastructure.
For Excelerate Energy, this deal strengthens its footprint in the Middle East and underscores its role as a leading provider of integrated floating LNG solutions. It is also the company’s first fully integrated floating LNG import project in the region, combining supply, storage, and regasification services.
Despite the promising outlook, the project faces challenges, including construction risks, regulatory hurdles, and potential regional instability. Fluctuations in global LNG prices could also influence project economics. However, if successfully implemented, the floating LNG terminal could mark a turning point in Iraq’s transition toward a more diversified and resilient energy system.
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Source: Offshore Energy
