Turkmenistan and Iran have struck a deal to deliver 10 billion cubic meters of Turkmen gas annually to Iraq, through a new pipeline that would stretch across Iran. 

The agreement was announced by Turkmenistan's Foreign Ministry without disclosing the financial details of the contract. Under the agreement, Iran will build a new 125-kilometer pipeline to its territory to boost Turkmenistan's export capacity.

The deal comes after disruptions in Iranian gas deliveries hampered Iraq's energy sector last year since Tehran’s gas exports accounted for roughly 40% of Iraq's imports at the time.

Gas sales are a critical revenue stream for Turkmenistan, which boasts vast natural gas reserves. The country aims to increase gas supplies to Iran to 40 billion cubic meters per year in the future.

The Central Asian nation, a former Soviet republic, heavily relies on exporting its natural gas riches, with China being among the countries on its list of customers. China is currently Turkmenistan's primary gas customer, and the country is also developing a pipeline project to deliver gas to Afghanistan, Pakistan, and India.