ERBIL, Kurdistan Region – The Kurdistan Regional Government (KRG) said it has abided by 97 percent of its commitments under a key oil agreement with Baghdad, but that in return the central government has lived up to only 20 percent of its financial obligations.
The KRG “is on schedule with the implementation of its crude oil export deal with the federal government, enabling Iraq to increase oil export and revenue at a critically important time for the stability and unity of the country,” the Ministry of Natural Resources said in a statement.
“The KRG remains fully committed to the oil deal with the federal government and will abide by the Budget law of 2015,” it said.
Erbil and Baghdad finalized an agreement in December whereby Erbil would contribute to the federal budget by daily selling 550,000 barrels of oil for Baghdad.
Baghdad cut off the Kurdistan Region’s share of the federal budget in January last year, placing a severe strain on the Kurdish government that is at war with the Islamic State (ISIS) and is grappling with received 1.4 million refugees from Syia and the rest of Iraq.
The deal signed in December – at a crucial time when both Baghdad and Erbil are at war with the Islamic State (ISIS) – was meant to have mended months of strained ties and disagreements over Kurdish oil exports. The 2015 federal budget had promised the resumption of payments to Erbil to turn the regional government.
The KRG statement complained that Baghdad was not sticking to its end of the bargain.
It noted that Erbil is “on track” with its promised delivery of Kurdish oil at Ceyhan, and was “also facilitating the export of otherwise stranded oil produced by the North Oil Company in Kirkuk.”
The statement added that, in line with its commitment to the terms of the 2015 federal budget, the KRG had until the end of February met almost 97 percent of its agreed supply of crude oil to SOMO at the Turkish port.
“The KRG in turn expects the federal government to honor its obligations under the budget law and to provide the KRG with its legal monthly entitlement to its share of the budget, including the agreed special allocation of funds for the Peshmerga forces,” the statement said.
“To date, the federal government has provided the KRG with less than 20 percent of its share of the budget for January and nothing for February,” the statement noted.
“The Kurdistan Region’s share is specified to be 17 percent of gross expenses,” said the statement from the Ministry of Natural Resources.
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