U.S. Hails Landmark Energy Deal Between Excelerate and Iraq as Key Step Toward Independence from Iran

ERBIL (Kurdistan24) — The United States Embassy in Baghdad on Tuesday congratulated the American energy company Excelerate Energy for signing a landmark agreement with Iraq’s Ministry of Electricity to establish a floating natural gas terminal, a project Washington described as a “crucial step for Iraq’s energy independence from Iran.”

In a statement posted on its official X account, the embassy hailed the deal as a move that would “strengthen Iraq’s sovereignty and create prosperity for both our nations.”

The project is expected to help Baghdad diversify its energy sources, enhance domestic power generation, and gradually reduce its reliance on Iranian gas imports — a long-standing goal encouraged by Washington.

For years, Iraq has depended heavily on natural gas imports from Iran, which supply nearly 40 percent of the fuel used to generate its electricity. This dependency has left Iraq vulnerable to frequent power shortages whenever Iran cuts supplies, often due to unpaid debts or internal demand pressures.

The U.S., which enforces strict sanctions on Iranian energy exports, has repeatedly issued temporary waivers allowing Iraq to purchase Iranian gas but has also urged Baghdad to develop alternative supply routes and invest in domestic production.

The new partnership with Excelerate Energy, therefore, is being viewed as a significant step toward realigning Iraq’s energy policies and reducing Tehran’s influence.

Observers note Washington’s backing of such projects aims to weaken Iran’s economic leverage over Iraq and limit the reach of Iran-backed militias within the country. 

These militias, operating under the Popular Mobilization Forces (PMF), have frequently targeted U.S. military bases and diplomatic sites, straining relations between Baghdad and Washington and complicating Iraq’s efforts to balance its foreign policy.

Despite these challenges, Iraq has always expressed commitment to pursuing energy diversification with support from the U.S. and regional partners. However, now real actions by the Iraqi government in this regard have been taken. 

The Excelerate project will provide Iraq with the capacity to import liquefied natural gas (LNG) from multiple sources via the planned floating terminal, enhancing flexibility and resilience in its energy sector.

Headquartered in The Woodlands, Texas, Excelerate Energy is a global leader in floating liquefied natural gas (FLNG) solutions. Founded in 2003, the company pioneered the use of Floating Storage and Regasification Units (FSRUs) — specialized vessels that allow countries to import and utilize LNG without building costly onshore infrastructure.

Excelerate currently operates in more than ten countries, providing innovative energy infrastructure designed to expand access to cleaner and more reliable fuel.

The deal marks a deepening of U.S.–Iraq economic cooperation at a time when Washington continues to pressure Baghdad to assert greater energy and political independence from Tehran.

If successfully implemented, the project could represent one of Iraq’s most tangible steps yet toward reshaping its energy landscape — and rebalancing its foreign relations in the process.