Iran’s Mapna Group, a leader in construction and installation of energy production machinery, is building a natural gas combined cycle power plant in Basra, Iraq at a cost of $2.5 billion, a report said.

The project aims to add 3,000 MW of electric power to Iraq's national grid, added the Iran Daily report, citing a Press TV release.  

Mapna signed the deal with the Iraqi-Jordanian Shamara Group, following implementation of Najaf and Baghdad power plants which will receive Iranian gas through a pipeline to begin operation the report added.

Mapna had begun implementing the Rumaila power plant near Basra after one and a half years of negotiations with the Iraqi side, Abbas Aliabadi, managing director of Mapna was quoted as saying in the report.

The facility will be completed in four years while the first unit is expected to join the national grid in early 2017.

The deal includes the Iraqi government's guaranteed purchase of the electricity generated from the power plant for 15-17 years, Shamara CEO Ali Shamara said, adding his country will finance the entire project.

Mapna will supply equipment, including gas and steam turbines and boilers besides engineering and supervising the project.

According to Shamara, security issues have been taken into consideration in deciding to build the facility in Rumaila in the relatively stable southern Basra which is only 60 km from the Iranian city of Ahvaz.

"Mapna's reliability and its accessibility are the reasons that convinced us to cede the project to this company since it can immediately report to the site in any eventuality," Shamara added.

The project is set to boost Iraq's overall power generation capacity by 20 percent as part of plans to generate 20,000 megawatts by 2016.