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ERBIL, Kurdistan Region - Russia would like to see the resumption of Kurdish oil exports, Moscow’s ambassador to Iraq said on Sunday, noting they directly benefit Russian oil companies.
“Unfortunately, they are [Kurdistan Region oil exports] halted up to now. We are interested in them to be resumed because it is in direct interest of our companies,” Ambassador Elbrus Kutrashev told Rudaw.
Oil exports from the Kurdistan Region have been halted since March 2023 after a Paris-based arbitration court ruled in favor of Baghdad against Ankara, saying the latter had breached a 1973 pipeline agreement by allowing Erbil to begin independent oil exports in 2014.
“We are having dialogue on this issue with Iraqi and Kurdish partners and friends. So [we] hope that at some moment we’ll these exports to start again, and results will be beneficial for all sides,” Kutrashev said.
Since the halt, Kurdish and Iraqi authorities have been discussing a mechanism for resuming oil exports. In a televised interview earlier this month, Iraqi Prime Minister Mohammed Shia’ al-Sudani told Bloomberg, “There are ongoing talks with the companies and with brothers in the Kurdistan Region. And we hope to reach a solution based on the legal paths,” He called a solution by the end of 2024 “Possible.”
Before the halt, Erbil exported around 400,000 barrels per day through Ankara, in addition to some 75,000 barrels of Kirkuk’s oil.
On Thursday, the finance committee of the Iraqi parliament and the Kurdistan Regional Government (KRG) reached an initial agreement to review the Kurdish government’s contracts with international oil companies, with the goal of restarting oil exports. This was one of the major obstacles ahead of the resumption of exports.
When it began its independent oil sector, the KRG signed production-sharing contracts with international oil companies. Under this model, the oil companies cover the entire cost of production while the KRG receives the lion’s share of the profits from successful projects.
Baghdad has repeatedly said that these contracts violate the constitution and must be amended to match the service contracts that the federal government prefers before exports can resume.
The loss in oil revenues, the Kurdistan Region’s main source of income, has worsened the financial situation and left the government unable to pay its public sector without assistance from Baghdad.
Payam Serbast contributed to this report
“Unfortunately, they are [Kurdistan Region oil exports] halted up to now. We are interested in them to be resumed because it is in direct interest of our companies,” Ambassador Elbrus Kutrashev told Rudaw.
Oil exports from the Kurdistan Region have been halted since March 2023 after a Paris-based arbitration court ruled in favor of Baghdad against Ankara, saying the latter had breached a 1973 pipeline agreement by allowing Erbil to begin independent oil exports in 2014.
“We are having dialogue on this issue with Iraqi and Kurdish partners and friends. So [we] hope that at some moment we’ll these exports to start again, and results will be beneficial for all sides,” Kutrashev said.
Since the halt, Kurdish and Iraqi authorities have been discussing a mechanism for resuming oil exports. In a televised interview earlier this month, Iraqi Prime Minister Mohammed Shia’ al-Sudani told Bloomberg, “There are ongoing talks with the companies and with brothers in the Kurdistan Region. And we hope to reach a solution based on the legal paths,” He called a solution by the end of 2024 “Possible.”
Before the halt, Erbil exported around 400,000 barrels per day through Ankara, in addition to some 75,000 barrels of Kirkuk’s oil.
On Thursday, the finance committee of the Iraqi parliament and the Kurdistan Regional Government (KRG) reached an initial agreement to review the Kurdish government’s contracts with international oil companies, with the goal of restarting oil exports. This was one of the major obstacles ahead of the resumption of exports.
When it began its independent oil sector, the KRG signed production-sharing contracts with international oil companies. Under this model, the oil companies cover the entire cost of production while the KRG receives the lion’s share of the profits from successful projects.
Baghdad has repeatedly said that these contracts violate the constitution and must be amended to match the service contracts that the federal government prefers before exports can resume.
The loss in oil revenues, the Kurdistan Region’s main source of income, has worsened the financial situation and left the government unable to pay its public sector without assistance from Baghdad.
Payam Serbast contributed to this report
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