Istanbul – After the two sides have reached an agreement to settle the oil dispute between the Kurds and Iraqis, the autonomous region of Kurdistan is expecting the initial; part of the payment worth 1 trillion dinars will be cleared by Baghdad in the next week. This information has been revealed by Ashti Hawrami on Monday.
The oil export form the Kurdish region will be resumed in October and the amount of crude oil will be 200,000 bpd and this amount will continue for the rest of the year 2012. After that the amount of oil will rise. This information has been provided by Hawrami at an energy conference being held in Istanbul.
He has further added that by the year 2015, the amount of oil export will reach 1 million bpd. They have found out the track and they are confident of reaching the goal even if the export from Kurdistan stops.
During the earlier part of this month, both Baghdad and the Kurdish government had come to an agreement for solving the oil dispute. This solution has been achieved when the Kurds agreed to continue the export after Baghdad has agreed on paying the foreign companies which are working in the Kurdish region.
The increased amount of production from Kurdistan and other oil fields in the southern region of Iraq in the upcoming future will mean that Iraq will require a new pipeline up to Turkey in order to deal with the combined production of oil which can reach the amount of 6 to 7 million bpd. This information has been provided by Hawrami.
The new pipelines from turkey with a capacity of one million bpd of oil and the gas pipeline the capacity of which is yet to be determined will increase the amount of oil supply and will be created and joined by Turkey, during the first half of the year 2014.
It is the plan of the Kurdish region to supply 15 billion cubic meters of gas to Turkey. According to Hawrami, apart from the straight way, they are also looking forward to the other way of gas transition which will take the additional amount of gas to Europe through Turkey and this transition can happen through pipeline or an LNG plant situated at Ceyhan.
Kurdistan had halted the oil supply in the month of April as a protest against the amount of due payments to the companies working in the Kurdish region. The money is due in the part of the central government.
Small sized oil [producers like the Genel Energy of London and DNO of Norway have been working in the region for the past decade. Among the new arrivals, there are oil producing majors like Chevron, Total and Exxon Mobil.
The problem with the export of the oil is in reality a part of the long standing border dispute of oil and territory. The draft of an oil and gas law which will solve the [problem between the two parties have been caught between the political complications for years.
Hawrami has said that, this deal is sort of a temporary deal between the two parties before full-fledged oil and gas law is created and implemented. This deal will allow the oil companies to get compensation according to the oil contracts they have. The extra amount of profit will go to Baghdad and that money will help and benefit everyone under the budget allocations.
He has also added that the agreement has been formed in such a way that the export does not get disrupted in any way. The problem beforehand was the fact that, nothing like that has been strictly been mentioned in the budget.
Kurdistan has got its autonomy in the year 1991 and it has authority, armed forces but still depends on the funding provided by the central government. The Kurds use the national pipelines for supplying oil. According to Baghdad, it has the sole right to export oil and gas produced in the country of Iraq.
Hawrami has said that, by next year KRG will increase the amount of oil refining capacity from 70,000 bpd and make the region self sufficient in this matter.
He has also told the conference that, further products from Baghdad won’t be required by the Kurds anymore.