Iraq has a major Natural Gas Pipeline with the capacity to supply around 240 MMcf/d to Baghdad from the West Qurna field. The 48-inch line was commissioned in November 1988, with phases II and III of the project never completed due to war and sanctions.
 
The last two phases of the pipeline project were meant to supply Turkey (which now has little need for the gas due to an oversupply in that country). Iraq's Northern Gas System, which came online in 1983, was damaged during the Gulf War as Well as by the Kurdish rebellion of March 1991. The system supplied LPG to Baghdad and other Iraqi cities, as well as dry gas and sulphur to power stations and industrial plants. Iraq also has a Southern Gas System, which came online in 1985.

Iraq plans to increase its natural gas output in order to reduce dependence on Oil consumption, to use for Petrochemicals production, and possibly for export at some point. Prior to the 1990/1991 Gulf War, Iraq exported significant volumes of natural gas to Kuwait. The gas came from Iraq's southern Rumaila field through a 40-inch, 100-mile, 300 Mmcf/d pipeline to Kuwait's central manifold at Ahmadi. The gas was used in Kuwaiti electric power stations and liquefied Petroleum gas (LPG) plants. Currently, Kuwait and Iraq are making plans to restart the pipeline.
 
A memorandum of understanding between the two governments was concluded in December 2004. The first phase of the project is modest, involving only 35 Mmcf/d, which would be transported through the existing pipeline. The second phase would involve an $800 million investment in refurbishment of the pipeline and associated pumping stations, which would allow the volume to increase to 200 Mmcf/d. For the time being, though, the security situation in Iraq has prevented even the first phase of the plan from being implemented.

In addition, Iraq and Kuwait have discussed joint development of the Siba natural gas field which straddles the two countries border near Iran. Prior to the war, Iraq had even been developing plans to build a liquefied natural gas (LNG) terminal. In late September 2004, Iraq reportedly agreed to join the Arab Gas Pipeline project linking Egypt, Jordan, Syria and Lebanon.

Source: Energy Information Administration