Exxon vis­its dis­puted Iraqi oil block

The Kurdish Globe - - EDITORIAL -

Exxon Mo­bil and Iraqi Kur­dis­tan of­fi­cials vis­ited an oil ex­plo­ration block caught in a dis­pute be­tween Bagh­dad's cen­tral government and the au­tonomous Kur­dish re­gion, and dis­cussed build­ing a camp there, a lo­cal of­fi­cial and sources say.

Talks at the Qara Han­sher block be­tween an Exxon ex­ec­u­tive and a top Kur­dis­tan oil of­fi­cial could pro­voke Bagh­dad at a sen­si­tive time for the Arabled cen­tral government and the self-ruled Kur­dish en­clave in their feud over oil and land rights.

Since it signed for six oil blocks with Kur­dis­tan last year, Exxon has been at the cen­tre of the grow­ing dis­agree­ment be­tween Bagh­dad and Kur­dis­tan that threat­ens to frac­ture the OPEC mem­ber's un­easy fed­eral union a year af­ter U.S. troops left.

The visit came as Exxon weighs whether to stay or pull out of its huge West Qurna oil­field in the Iraqi south or keep its Kur­dis­tan fields. Iraqi and Kur­dish of­fi­cials have both sug­gested Exxon will side with them.

The Qara Han­sher field, where the meet­ing took place on Wed­nes­day just north of Kirkuk, sits in the swath of dis­puted ter­ri­to­ries, where both re­gions claim ju­ris­dic­tion and where Iraqi Arab and Kur­dish troops have re­in­forced po­si­tions in a tense stand­off since last year.

"In the meet­ing we dis- cussed the work of Exxon Mo­bil in Qara Han­sher block and we dis­cussed how to fa­cil­i­tate the com­pany's work," Avesta Sheikh Mo­hammed, the lo­cal Kur­dish ma­jor of the area. "The Kur­dis­tan Re­gional Government has all the right to sign oil deals to de­velop en­ergy re­sources."

An Iraqi oil of­fi­cial and a Kur­dis­tan oil of­fi­cial con­firmed the meet­ing had taken place to talk over build­ing a camp in the block in the low hills.

No work or drilling has started at the Qara Han­sher block - whose name means "black fig" in Kur­dish - and the talks were for an ini­tial site, the sources said.

Qara Han­sher shows the com­pli­ca­tions of work­ing in the dis­puted ter­ri­to­ries. Be­fore the 2003 in­va­sion that top­pled Sad­dam Hus­sein, Qara Han­sher was part of Kirkuk. Bagh­dad still con­sid­ers it part of Kirkuk, but the Kurds claimed it as part of their re­gion and the mayor was app­pointed by the Kur­dis­tan Re­gional Government.

Bagh­dad says oil deals signed with Kur­dis­tan are il­le­gal and warned for­eign com­pa­nies they risk los­ing their agree­ments in Iraq's south­ern oil­fields if they de­velop Kur­dis­tan fields. But fields in the dis­puted ter­ri­to­ries are more com­pli­cated.

In­dus­try sources have said Exxon is con­sid­er­ing con­ces­sions from Bagh­dad to keep to stay at the $50 bil­lion West Qurna.

One Iraqi oil of­fi­cial said the U.S. ma­jor may be try­ing to smooth rela- tions with Kur­dis­tan with the block visit af­ter the com­pany's top ex­ec­u­tive meet last month with Iraq's Prime Min­is­ter Nuri al-Ma­liki.

"If Exxon vis­ited the block that does not mean it will ac­tu­ally start up­stream op­er­a­tions any­time soon. I think they are com­fort­ing the Kurds, say­ing they won't aban­don them," a se­nior Iraqi oil of­fi­cial said. "Let's not jump to con­clu­sions, let's wait and see."

Au­ton­omy And Oil

Au­tonomous since 1991 with its own re­gional government and armed forces, Kur­dis­tan says that the fed­eral con­sti­tu­tion en­shrines its right to de­velop its oil­fields.

The re­gion is steadily de­vel­op­ing more en­ergy au­ton­omy, but still re­lies on the cen­tral government for a share of the na­tional bud­get from oil rev­enues.

Since Exxon en­tered Kur­dis­tan, ten­sions be­tween Bagh­dad and Kur­dis­tan have in­creased, but the U.S. ma­jor's move also opened the door for other large for­eign com­pa­nies such as Chevron , France's To­tal and Rus­sia's Gazprom Neft to sign up.

Chevron re­cently added a third block to its as­sets in Kur­dis­tan.

Iraq's oil min­is­ter on Sun­day said dur­ing the most re­cent meet­ing with Exxon, the government had made clear once again that the U.S. com­pany must de­cide be­tween the two re­gions.

"Exxon Mo­bil can­not work in the two fields at the same time," Oil Min- is­ter Ab­dul Ka­reem Luaibi said.

In­ter­na­tional oil com­pa­nies have been pre­pared to take that risk in re­turn for Kur­dis­tan's bet­ter con­tract terms, se­cu­rity and an eas­ier work­ing en­vi­ron­ment, as op­posed to the bu­reau­cracy and in­fra­struc­ture hur­dles ham­per­ing south­ern oil projects.

The oil dis­pute has been ac­com­pa­nied by an in­crease in mil­i­tary ten­sions be­tween the two re­gions.

Last year Iraqi na­tional army and Kur­dish Pesh­merga forces both sent troops to re­in­force their ri­val po­si­tions around towns dot­ted along the dis­puted ter­ri­to­ries, in­clud­ing the sen­si­tive eth­ni­cally mixed town of Kirkuk.

Newspapers in English

Newspapers from Iraq

© PressReader. All rights reserved.