Kurd oil law drives Iraq oil

Iraq’s Kurdistan Regional Government will not wait for a federal oil law before it starts signing more contracts to explore what is thought to be sizeable reserves in its territory. The KRG has already signed a handful of contracts with small oil companies and, now that it has passed a regional law governing any underground oil and natural gas, it will not put development on hold while Baghdad implodes.

“It might take us a little while to sign the next batch of contracts,” KRG Natural Resources Minister Ashti Hawrami told United Press International, “but at least we have now paved the way for that.”
Iraq’s federal oil law has been stuck in negotiations for more than a year. The Kurds had been carefully slowing their own law, hoping the federal law would be completed. Two weeks ago the KRG Parliament unanimously approved the law. The approved version has not been released yet; Hawrami said it’s still being translated into English and Arabic.

He said a version of the federal law the KRG agreed to in February “is in line with our law.”

Whether the new KRG law is the constructive pressure needed to push those debating the federal law is not clear.

“We would like to assume that,” Hawrami said in a telephone interview from Irbil, the KRG capital. Regardless, “we’re not going to wait for the federal law. No. If we were waiting for the federal law, there’s no point in doing our own law.”

“In Kurdistan, we have about 0.5 percent of Iraq’s proven reserves, less than one percent,” Hawrami said, adding when fully explored he expects the KRG could produce as much as 1 million bpd. “We’re looking at creating proven reserves, new production, and sharing that with the rest of the Iraqi people.”

Critics, however, say too much control for local governments risks overproduction and lessening the value of Iraq’s oil.

UPI