(VOVworld) – On Wednesday, Iran signed a new contract with Iraq to export natural gas to the southern port city of Basra over six years.

The construction of a pipeline to Basra will require an investment of about 2.3 billion USD (photo: ap)

Exports will start with an initial supply of 7 million m3 of gas per day for three years and will then increase in volume to feed the main power plant of the city.

Hamid-Reza Araghi, the general director of the National Iranian Gas Company (NIGC), said the construction of a pipeline to Basra will require an investment of about 2.3 billion USD, adding that the project will be completed by May 2016. He said the price of the gas that Iran will pipe to Basra will be the same price as the gas sent to Baghdad under an earlier deal.

In 2013, Iran and Iraq signed a deal to export natural gas from the South Pars energy hub to Baghdad but it was delayed due to a security crisis in Iraq.