BAGHDAD, Sept. 14 (Xinhua) -- Iraqi Ministry of Electricity signed Saturday a deal valued 1.3 billion U.S. dollars with the consortium of the German Siemens and the Egyptian Orascom to renovate two power plants in Iraq's central province of Salahudin.
A statement by the ministry said that the two companies will rebuild Baiji 1 and Baiji 2 power plants, which both will add 1.69 gigawatts to the country's overall power production in 28 months after these two plants enter the service.
Located near the oil-refinery town of Baiji, some 200 km north of the Iraqi capital Baghdad, the two plants were severely damaged by the Islamic State (IS) militants, who once took control of parts of Salahudin province.
The Minister of Electricity Louay al-Khatib said that the signing of the contract came as part of a plan prepared by the Ministry of Electricity to rehabilitate the electric power sector in Iraq, particularly in the liberated areas from IS militants, according to the statement.
In May, Iraqi Prime Minister Adel Abdul Mahdi visited Germany and signed cooperation agreements, including the signing of a roadmap deal valued around 14 billion dollars of contracts in total with Germany's Siemens to rebuild Iraq's electricity infrastructure following years of war.
Currently, Iraq's capacity of power generation exceeds 18 gigawatts, while its need is more than 24 gigawatts, according to the ministry's figures.
Iraq has been suffering acute shortage in power supply during the years after U.S.-led invasion in 2003, but the post-war governments failed to rehabilitate electricity production due to corruption and poor management.