By Rowena Edwards, Ahmed Rasheed and Maha El Dahan
LONDON/BAGHDAD, April 1 (Reuters) – Iraq’s federal government and the Kurdistan Regional Government (KRG) are close to reaching an agreement to resume oil exports from the north of the country, four sources familiar with Iraq told Reuters on Saturday. the conversations.
Turkey halted the flow of oil from its Kirkuk fields in the semi-autonomous Kurdistan region to its port of Ceyhan on March 25 after losing an arbitration brought by Baghdad.
In the case, Iraq accused Turkey of violating its 1973 pipeline deal by allowing the Kurdish government to export oil without Baghdad’s consent between 2014 and 2018.
The interruption of flows of some 450,000 barrels per day (bpd) only accounted for around 0.5% of world crude supply, but the stoppage, which forced oil firms operating in the region to stop pumping or transfer it to tanks Storage facilities that were filling up quickly helped push oil prices back to near $80 a barrel last week.
An initial agreement between the two parties states that oil exports from northern Iraq will be shipped jointly by the Iraqi state-owned trading company SOMO and the KRG’s Ministry of Natural Resources (MNR), according to two of the sources: a senior Iraqi oil official and another from the KRG.
The proceeds will be deposited in an account managed by the MNR and supervised by Baghdad, according to the KRG official.
The preliminary agreement has been sent to the Iraqi prime minister for final approval, according to two of the sources. The KRG source expects the deal to be confirmed on Monday.
The KRG declined to comment. The spokesman for the Iraqi Oil Ministry could not be reached outside of working hours.
Baghdad and the KRG have agreed to continue meeting after the resumption of oil exports to find solutions to other pending problems.
“(This includes) the contracts of foreign companies operating in Kurdistan and Kurdish debts,” the senior Iraqi oil official stated.
With its oil exports at a standstill, Kurdistan had halted repayments to energy operators, including Vitol and Petraco, of $6 billion worth of crude cargo contracts, according to trade sources. (Reporting by Rowena Edwards in London, Ahmed Rasheed in Baghdad, Orhan Coskun in Ankara and Maha el Dahan in Dubai; Additional reporting by Can Sezer in Istanbul; Editing in Spanish by Manuel Farías)
Source: Ambito
