Adds context, details on the deal and background

ISTANBUL, Aug 20 (Reuters) - Floating power plant operator Karpowership has signed a deal to provide Iraq with up to 590 megawatts of electricity to stabilise its national grid, the Turkish company said on Wednesday.

A member of the Organization of the Petroleum Exporting Countries and one of the world's leading oil producers, Iraq has struggled to provide its citizens with power since the 2003 U.S.-led invasion that toppled Saddam Hussein.

The initial contract, signed with Iraq's electricity ministry and the General Company for Electric Energy Production, is for 71 days, Karpowership said in a statement.

Two floating power plants will dock at Khor Al Zubair and Umm Qasr ports in Basra and are expected to be operational within the month, it added.

Iraq experienced power outages in central and southern regions this month as a sudden shutdown at a power plant led to a fault in the electricity grid.

Electricity minister Ziad Ali Fadhil said earlier this month that Iraq is currently producing around 28,000 MW of electricity.

Iraq has agreements with General Electric GE.N to build power plants with a capacity of 24,000 MW and Siemens SIEGn.DE to add 14,000 MW of capacity. It will also soon sign an agreement with Shanghai Electric 601727.SS to produce up to 10,000 MW, according to the state news agency.

Iraq needed between 32,000 MW and 35,000 MW to bridge the gap between production and demand, an electricity ministry official told Iraq's state news agency in March.

(Reporting by Can Sezer; Editing by Rashmi Aich and Joe Bavier)

((can.sezer@tr.com;))