Dana Gas secures long-term gas deal for Kurdistan’s cement and steel plants

Dubai: Dana Gas and Crescent Petroleum have signed long-term gas sales agreements to supply up to 142 million standard cubic feet a day of natural gas to industrial customers in the Kurdistan Region of Iraq, strengthening fuel security for cement and steel producers and advancing development of the Chemchemal gas field.

The agreements were signed by the Pearl Petroleum Consortium, which includes Dana Gas and Crescent Petroleum, with five cement producers in the Bazian industrial area and a steel manufacturer in Erbil. Gas deliveries are scheduled to begin in the second half of 2027, when production from the Chemchemal field is expected to start.

Ten-year supply to key industries

Under the agreements, industrial customers will collectively purchase up to 142 MMscf a day of gas over a 10-year period. The buyers include Mass Cement, Bazian Cement, Delta Cement, Gasin Cement and Sulaimani Cement in Sulaymaniyah province, along with Van Steel Company in Erbil.

New private-sector pipelines will be built to deliver gas from the Chemchemal field to industrial users. Plans include a dedicated 40-kilometre pipeline connecting the field directly to the Bazian industrial corridor, a major hub for cement production in the region.

The move is aimed at replacing heavier and more costly fuel oils currently used by manufacturers, while improving efficiency and lowering emissions.

$160m investment to unlock Chemchemal

Pearl Petroleum is advancing appraisal and development of the Chemchemal field, which is considered one of the region’s most significant undeveloped gas resources. The consortium has committed $160 million to drill three wells, install an extended well test facility and build enabling infrastructure.

Production from Chemchemal is expected to support a broader full-field development phase, allowing gas supply to expand beyond initial industrial customers over time.

Majid Jafar, CEO of Crescent Petroleum and board managing director of Dana Gas, said the agreements represent a turning point for the region’s energy landscape.

“These agreements mark a significant milestone in the development of the KRI’s energy infrastructure, delivering considerable supplies of clean burning natural gas to empower growth in the region’s industry and help displace the use of dirtier, more expensive heavy fuel oils,” Jafar said.

He said the deals build on recent progress at Pearl Petroleum’s assets and signal a new phase of expansion for the consortium in Iraq.

Richard Hall, CEO of Dana Gas, said the agreements strengthen the role of natural gas in supporting Kurdistan’s industrial base.

“This agreement supports the growing energy needs of the Kurdistan Region of Iraq and strengthens the role of natural gas as a fuel source for its industrial base,” Hall said. “By supplying competitive, lower-emission gas to the Bazian industrial corridor, we are helping replace polluting heavy fuel oil, reduce emissions and improve energy efficiency for key industries.”

Hall added that the impact would extend beyond energy supply, supporting industrial growth, local employment and longer-term economic activity around the Bazian corridor.

Building on Khor Mor expansion

The Chemchemal agreements follow the completion of the Khor Mor 250 gas expansion project in October 2025, delivered eight months ahead of the revised schedule. The project added 250 MMscf a day of processing capacity, lifting total capacity at Khor Mor to 750 MMscf a day.

Khor Mor supplies more than 80% of electricity generation in the Kurdistan Region, providing power to over 6 million people across the region and other parts of Iraq.

Total investment by Dana Gas and Crescent Petroleum in Kurdistan has exceeded $3.5 billion, creating more than 20,000 direct and indirect jobs. The companies expect further growth as new capacity comes on stream and Chemchemal production begins.