Oil and Gas law can re­solve Bagh­dad- Kur­dis­tan is­sues

Oil re­serves in the three Kur­dish gov­er­norates are at more than 45 bil­lion bar­rels

The Kurdish Globe - - NEWS -

Iraqi Kur­dis­tan Re­gion Nat­u­ral Re­sources Min­is­ter Ashti Hawrami said that the shares of oil com­pa­nies op­er­at­ing in the re­gion have ex­ceeded $3.5 bil­lion. He stressed the im­por­tance of the oil and gas law's en­act­ment, and es­ti­mated that oil re­serves in the three Kur­dish gov­er­norates are at more than 45 bil­lion bar­rels.

In an in­ter­view with Al-Hayat, Hawrami said that the ne­go­ti­a­tions with Bagh­dad will be in ac­cor­dance with the law, which de­ter­mines the Kur­dis­tan re­gion’s fi­nan­cial share of fed­eral rev­enues. “The pro­vin­cial govern­ment in­formed Bagh­dad at the be­gin­ning of this year that the in­vest­ing com­pa­nies re­quested more than $3.5 bil­lion [in shares], and they are con­sti­tu­tion­ally en­ti­tled to this,” he said.

He de­nied Bagh­dad’s ac­cu­sa­tions that the re­gion is ex­port­ing crude oil without co­or­di­nat­ing with Bagh­dad, adding, “This is tak­ing place un­der an agree­ment with Bagh­dad to ex­port our pro­duc­tion, on the con­di­tion that 50% of pro­ceeds is de­ducted to pay com­pa­nies’ dues, while the other 50% is kept by the state trea­sury. How- ever, all the pro­ceeds were seized.”

He de­nied ru­mors of smug­gling, say­ing, “There is no oil smug­gling, we do not ac­cept such cheap ac­cu­sa­tions. What was claimed is a le­gal en­ti­tle­ment and it came be­cause we for­bid them from grab­bing it.” He crit­i­cized the cur­rent man­age­ment of the coun­try's im­ports, which “still fol­lows the meth­ods of the for­mer regime and in­clude laws that are im­posed on us by force from the fed­eral govern­ment.”

Hawrami de­manded that the cen­tral govern­ment pro­vide the re­gion with the 55 mil­lion bar­rels of fuel “that we did not re­ceive from 2004 to 2012, and that are needed for do­mes­tic con­sump­tion.”

Hawrami stressed the need to en­act the oil and gas law, and said, “The law, which we are seek­ing to pass ac­cord­ing to the con­sti­tu­tion, will be the key for all the con­tentious is­sues be­tween the two sides in the oil sec­tor.”

Dur­ing a joint news con­fer­ence with Kur­dis­tan Re­gion of Iraq Pres­i­dent Mas­soud Barzani on Sun­day, July 7, Iraqi Prime Min­is­ter Nouri al- Ma­liki said, “There are no dis­putes be­tween the fed­eral govern­ment and the pro­vin­cial govern­ment, it is merely a di­ver­gence in views re­gard­ing the Con­sti­tu­tion.” Hawrami con­tin­ued,

“Most of the dif­fer­ences are po­lit­i­cal and they arise from the non-ap­pli­ca­tion of the Con­sti­tu­tion in re­la­tion to the dis­tri­bu­tion of pro­ceeds.”

Ar­ti­cle 112 of the Iraqi Con­sti­tu­tion stip­u­lates: "The fed­eral govern­ment with the pro­duc­ing gov­er­norates and re­gional gov­ern­ments shall un­der­take the man­age­ment of oil and gas ex­tracted from cur­rent fields pro­vided that it dis­trib­utes oil and gas rev­enues in a fair man­ner in pro­por­tion to the pop­u­la­tion dis­tri­bu­tion in all parts of the coun­try with a set al­lot­ment for a set time for the dam­aged re­gions."

The ar­ti­cle stresses, “The fed­eral govern­ment, with the pro­duc­ing gov­er­norates and re­gional gov­ern­ments, shall un­der­take the man­age­ment of oil and gas ex­tracted from cur­rent fields pro­vided that it dis­trib­utes oil and gas rev­enues in a fair man­ner in pro­por­tion to the pop­u­la­tion dis­tri­bu­tion in all parts of the coun­try with a set al­lot­ment for a set time for the dam­aged re­gions.” Hawrami down­played the im­por­tance of the pres­sure ex­erted by Bagh­dad on oil com­pa­nies op­er­at­ing in the re­gion to dis­cour­age them from im­ple­ment­ing the con­tracts. “This does not af­fect the work of these com­pa­nies and they are ready to con­tinue de­spite the de­lay in pay­ment of their dues,” he added.

“Crude oil re­serves in the Kur­dis­tan re­gion, ex­clud­ing the dis­puted ar- eas, are at 45 bil­lion bar­rels, and pos­si­bly even more. Yet the pre­lim­i­nary gas es­ti­mates are at 100 or 200 tril­lion cu­bic me­ters,” he said. Con­cern­ing his min­istry’s plans to in­crease pro­duc­tion in the com­ing pe­riod, he said, “The tar­get pro­duc­tion for 2015 is 1 mil­lion bar­rels per day, reach­ing 2 mil­lion bar­rels per day in 2019. As for the re­fin­ing of crude oil and the pro­duc­tion of hy­dro­car­bons, they are es­ti­mated to in­crease to 150,000 bar­rels per day, and could reach up to 250,000.”

Ashti Hawrami, min­is­ter of nat­u­ral re­sources of the Kur­dis­tan Re­gional Govern­ment speaks dur­ing the first In­ter­na­tional En­ergy Arena Er­bil on May 20, 2012.

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