Iraq explores carbon credits to reduce gas flaring

Iraq is moving ahead with plans to use carbon credits to fund energy infrastructure — a test of the government's ability to leverage a new source of financing to help reduce the ruinous impact of gas flaring at oil fields.

The first such project is planned for the East Baghdad cluster of oil fields, which is operated by China's EBS Petroleum: new gas processing infrastructure with the capacity to process up to 12 million standard cubic feet per day (scf/d) of so-called associated gas that is produced along with crude oil, according to an Oil Ministry statement.

Financing from carbon credits could be critical for Iraq's ambitions to shed the ignominious distinction of being the second-worst gas flaring country in the world, behind Russia. According to the World Bank, Iraq flared more than 17.9 billion cubic meters of gas in 2022, which was the country's second-largest source of carbon emissions behind oil.