Iranian Natural Gas Rig
Iranian natural gas rig in the Persian Gulf.

Baghdad confirmed a deal with Iran to import natural gas at international market prices, the AP reported Tuesday.

The four-year deal stipulates that Iraq will buy 850 million cubic feet of gas a day at international market prices, Musab al-Mudaris, a spokesman for the Iraqi Electricity Ministry, said.

Al-Mudaris said the gas will be transported through a pipeline that will be completed in two months.

The announcement comes after Iran's outgoing president, Mahmoud Ahmadinejad, had high-level meetings with Iraqi officials in Baghdad last week. Iranian state-controlled media, Press TV, reported on Friday that Tehran and Baghdad agreed to explore and develop crude oil and natural gas fields along their common border.

Natural gas recently sold for $3.74 per million Btus.