MEED conference told that Iraqi Kurdistan to share oil export proceeds with the rest of Iraq

Minister and head of the department of foreign relations in the Kurdistan Regional Government (KRG) Falah Mustafa Bakir told the MEED Kurdistan Projects conference in Erbil this morning that Iraqi Kurdistan is now an oil exporter and intends to share the proceeds with the rest of Iraq.

Bakir said Kurdistan has recently started oil exports.

“This is an enormous step for the future of the region,” Bakir said. “We are now a proud supplier and will be able to boost our economy with oil revenues we wish to share with Iraq.”

Bakir said that the KRG aims to build international relations. It has offices in 40 countries and plans to expand that network. “Our relations with Turkey specially speak to this and we seek similar relations with all our neighbours and beyond,” Bakir said.

His comments come a week after KRG Prime Minister Nechirvan Barzani told the Kurdistan region’s parliament in Erbil that Kurdish oil exports were not a prelude to seeking independence from Iraq. He said that Baghdad was to blame for the row over independent oil exports of oil produced in Iraqi Kurdistan.

“We don’t see this (oil exports) as a way for the independence of Kurdistan…” Barzani is reported as saying in answers to question from MPs on 4 June. “We want to implement our constitutional rights within Iraq.”

A pipeline allowing Kurdish oil to be delivered to the Turkish port of Ceyhan was completed in December 2013. The first deliveries to Ceyhan started on 23 May. The first tanker of Kurdish oil set sail from Ceyhan at the end of last month.

The destination of the oil is not known and it has not yet been unloaded. Observers say this suggests there are problems with contracts for Kurdish oil. The government of Iraq says the oil sales are illegal. The US says it opposes Kurdish energy exports without Iraqi government approval.

Speaking to the Kurdistan regional parliament on 4 June, Barzani rejected objections to direct Kurdish oil sales “We are absolutely confident about what we have done, which is in the interest of the people of Kurdistan and the framework of the Iraqi constitution,” he said.

“If they (Baghdad) had reached an agreement with us on the distribution of oil revenues, which is the most important law for Iraq, many problems would have been resolved,” he said. The KRG has rejected demands by the central government that the sales should be conducted by the State Oil Marketing Organization (SOMO). It wants SOMO only to be an observer.

Barzani said the KRG is entitled to 17 per cent of Iraq’s national budget. He said Baghdad has failed to consistently deliver more than 10 per cent. Barzani said that the KRG needed $41bn to finance investment in infrastructure.

Barzani said the KRG signed a 50-year agreement with Turkey for the export of Kurdish oil in Istanbul on 4 June.

“The protocol with Turkey is not to divide Iraq, but to get our own 17 per cent of the budget,” Barzani said.

“Kurdistan is taking its place on the global stage. We are embracing the world,” Bakir said.

MEED’s Kurdistan Projects 2014 Conference was organised in collaboration with the Kurdistan Regional Government, the KDBC and the UKTI. Taqa is strategic event partner. Conference sponsors are Drake & Scull, Falcon Group and Hill International. Jotun is exhibitor and Parson is networking event sponsor.