Iran will double gas exports to neighboring ally Iraq from 2017 under a contract signed on Wednesday.

Iran will double gas exports to neighboring ally Iraq from 2017 under a contract signed on Wednesday.

The deal, to send 20 to 35 million cubic meters of gas per day to the southern Iraqi city of Basra, follows a first major contract between the countries in 2013 to export gas to the Iraqi capital Baghdad.

"The gas export will begin in a year and a half with new pipelines and facilities," Iran's Deputy Oil Minister Hamid Reza Araghi said, before signing the contract with Iraq's deputy energy minister.

The contract is for six years, he added, without mentioning its total value.

"The pricing will be similar to that of the Baghdad contract," Araghi said.

Local media had earlier reported that the Baghdad contract, to export 25 million cubic meters of gas a day, was worth $3.7 billion (3.4 billion euros) a year.

Iran sits on the world's second largest natural gas reserves and produces some 600 million cubic meters a day, almost all of which is consumed domestically due to lack of exports means.