Cursor International executes projects and collaboration activities across several industries.
By John Lee.
The CWC Kurdistan-Iraq Oil and Gas conference, planned for London in December, has been postponed.
The Kurdistan Regional Government (KRG) cited “the current logistical and other circumstances affecting the Kurdistan Region” for their request to reschedule the conference.
CWC has said that new dates and venue will be announced shortly.
(Sources: KRG, CWC)
By Adnan Abu Zeed for Al Monitor. Any opinions expressed here are those of the author and do not necessarily reflect the views of Iraq Business News.
The Iraqi State Organization for Marketing Oil (SOMO) announced Nov. 2 that it is arranging with Turkey to allow SOMO to sell Iraqi crude from the disputed territories through the pipeline from Kirkuk to the Ceyhan Turkish port.
The Kurdistan Regional Government (KRG) used to export about 500,000 barrels per day independently through Ceyhan before the Baghdad operation to retake the disputed areas in mid-October.
It was not long after the Iraqi army took over the oil fields in Kirkuk in a military operation to “impose security,” as described by Prime Minister Haider al-Abadi, that the federal government resumed oil pumping operations.
The operations started about a week after the clashes between governmental forces and Kurdish peshmerga forces. Meanwhile, the Ministry of Oil rushed to increase oil production, and on Oct. 23, the ministry requested the help of the British petroleum company BP in increasing production in Kirkuk oil fields to more than 700,000 barrels per day. The ministry also announced the formation of a ministerial committee to advance the oil industry in the province of Kirkuk.
Kirkuk has more than 35 billion barrels in oil reserves and a production capacity ranging from 750,000 to 1 million barrels per day. The federal government seems determined to control the oil sources, especially in Kirkuk and the disputed areas. In light of this, on Oct. 19, the Iraqi minister of oil warned all countries and international petroleum companies against signing contracts with any Iraqi party without first consulting the federal government.
Genel Energy has announced that the company has received an override payment of $6.41 million from the Kurdistan Regional Government (KRG).
The payment represents 4.5% of Tawke gross field revenues for the month of September 2017, as per the terms of the Receivable Settlement Agreement.
An entitlement invoice for that month’s export deliveries has been issued separately and will be shared pro-rata with DNO upon receipt.
(Source: Genel Energy)
By Ahmed Tabaqchali. Originally published by Iraq in Context; re-published by Iraq Business News with permission. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
Between February 2017 and mid-October, Rosneft signed a number of deals with the Kurdish Regional Government (KRG) that established for it, and by extension for Russia, a major position as both an investor and stakeholder in the Kurdish Region of Iraq (KRI)’s hydrocarbon resources and infrastructure.
The move was interpreted, especially by the KRG, as implicit support for the KRG in its bid for independence, especially in light of the latest deal signed following the reassertion of Iraq’s federal control over Kirkuk and other disputed territories. While there is an element of truth to this thinking, the deals are part of a wider geopolitical positioning for Russia as a major gas supplier to Europe and as an emerging power in the Middle East.
The deals provide Rosneft, and by extension Russia, effective control of the KRG’s Oil & Gas infrastructure, and a controlling stake in the region’s finances in more ways than one.
Within the oil space it has established this in three ways. The first was by providing USD 1.5bn in financing via forward oil sales payable over 3-5 years. This would be payable in kind from the KRG’s exports, until recently at about 550,000-600,000 barrels per day (bbl/d). However, the loss of the Kirkuk fields takes away about 430,000 bbl/d of production or eventually about half of the KRG’s exports.
This leaves the KRG with a tiny revenue stream after payments to International Oil Companies (IOC)’s, from which to make payments on forward oil sales of up USD 3.5 bn including Rosneft’s USD 1.5bn. A complicating factor is the repayment of other KRG debt, estimated at over USD 21bn by end of 2017, which will have to be factored into debt payment sustainability.
By John Lee.
Iraq’s Ministry of Oil has hit back at Rosneft‘s recent decision to enter a production-sharing deal with the Kurdistan Regional Government (KRG) without its approval.
In a statement, the Ministry warned:
“The ministry of oil warns seriously all the countries and oil companies from contracting or dealing with any authority inside Iraq without taking the approval from the federal government and the ministry of oil”.
Oil Minister Jabar Ali al-Luaibi [Allibi, Luiebi] (pictured) added:
“… irresponsible statements from some of the officials inside & outside Iraq or the foreign companies about their intention to sign oil contracts with any authority inside the geographic borders of Iraq without telling the federal government or the ministry of oil, is considered as a Blatant interference in the internal affairs and a derogation from national sovereignty, and an outright violation of international norms.”
Rosneft boss Igor Sechin insisted that the company strictly followed the law. AFP quotes him as saying:
“If there are problems between the government of Iraq and Kurdistan they need to solve the problems themselves … I am not a politician, my job is to produce oil.”
In addition to the production-sharing deal, Rosneft has just agreed to start work on a new oil pipeline project in Iraqi Kurdistan.
(Sources: Iraqi Ministry of Oil, AFP)
Russia’s Rosneft and Kurdistan Regional Government (KRG) have announced the start of joint implementation of an infrastructure project for the operation of the oil pipeline in the Kurdish Autonomous Region.
According to a statement from Rosneft, its share in the project “may amount to 60%“.
“The other project participant with 40% share will be KAR Group, who is the current pipeline operator,” it added.
Rosneft Chief Executive Officer Igor Sechin (pictured) said:
“The entry into the infrastructure project will contribute to achievement of Rosneft’s strategic objectives and will enable Rosneft to enhance the efficiency of oil transportation to the end customers including supplies to the Company’s refineries in Germany”.
(Source: Rosneft)
Russian state-controlled oil company Rosneft and the Government of the Kurdish Autonomous Region of Iraq signed the documents required to put into force Production Sharing Agreements (PSA) with respect to five production blocks located in the Kurdish Autonomous Region.
The share of Rosneft Group Subsidiaries in PSA will be 80%, the amount of payments for the projects farm-in and geological information for each of five blocks ranges from 40 mln. USD to 110 mln. USD and may total to 400 mln.USD (incl. 200 mln.USD that can be compensated by oil produced from block), the heads of terms of the agreements and the basic principles of product distribution are similar to the PSA in Iraqi Kurdistan that were signed by other international oil and gas companies.
The parties agreed to implement the geological exploration program and to start pilot production as early as in 2018. In case of success, in 2021 it is planned to start full-field development of the blocks. According to conservative estimates, the total recoverable oil reserves at five blocks may be about 670 million barrels.
The documents were signed in pursuance of the Investment Agreement which was concluded at the St. Petersburg International Economic Forum in 2017.
(Source: Rosneft)
By , for Al-Monitor. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
Iran and the Kurdistan Regional Government (KRG) in Iraq have historically been on good terms. During the Saddam Hussein years, Iran was one of the main countries to host Kurdish leaders. In the post-Saddam era, Tehran and Erbil have enjoyed good neighborly relations.
This relationship manifested itself in Iranian forces coming to the rescue of the Kurdish regions in their fight against the Islamic State (IS) in the summer of 2014. However, the recent independence referendum in the KRG has angered Tehran, and it is clear that the Kurdish moves will impact on both bilateral ties and wider regional alignments.
One important aspect to consider when assessing the fallout between Iran and the KRG following the independence vote is the economic dimension of their relationship in the geostrategic context of Iranian concerns.
Iran and the KRG have a multilayered relationship; most importantly, it is not all driven by the government. On the one hand, there are various trade links between the two sides, starting from very active border markets up to cross-border trade and investment.
There are five border markets between Iran and Iraqi Kurdistan. Prior to the recent events, there were plans to expand such entities to create jobs and also shift the unofficial trade toward official channels. In fact, the KRG is an important market for Iranian exporters. The trade volume between the two sides amounted to $8 billion in 2014, which made Iran the KRG’s second-largest trading partner, after Turkey.
In recent years, Iranian exports to the Kurdistan Region have dropped due to the conflict against IS. Yet, according to Kurdish sources, the trade volume between Iran and the KRG stood at $4 billion in 2016. This means that approximately 40% of the Iran-Iraq trade goes through the KRG.
By John Lee.
Iraq is reportedly considering using security forces to prevent Kurdistan from blocking oil output from Kirkuk.
A spokesman for the North Oil Company (NOC) told Reuters that Kurdish officials indicated that they would shut down production at the Kirkuk oilfield, ostensibly for security reasons, but as a means of putting pressure on Baghdad.
Kirkuk produces around 200,000 barrels per day, out of total Kurdish production of over 600,000 bpd.
(Source: Reuters)
Federal forces in control of large areas of Kirkuk city; further Kurdish withdrawals in Nineveh/Diyala
Over the course of October 16, Iraqi federal forces advanced into many parts of Kirkuk city and adjacent military and energy facilities. The Counter-Terrorism Service (CTS), supported by the Iraqi Army and Federal Police took control of the K1 military base, the governor’s palace, the Kirkuk Provincial Council headquarters, the North Oil Company and North Gas Company headquarters, the Kirkuk Regional Air Base, and key areas of Kirkuk city and road junctions.
While Popular Mobilization Units (PMU) took part in operations in rural areas, they were not deployed into the Kirkuk city area. Local Kurdish forces aligned with the Patriotic Union of Kurdistan (PUK) offered minimal resistance as federal forces moved into the area, many media reports have focused on an agreement in place between the PUK leadership and Baghdad for an orderly transfer of the facilities listed.
As a result, Baghdad is now in control of the portions of PUK-controlled Kirkuk that it held prior to the 2014 military collapse. Government forces were also reported to have moved into the oil fields of Dibis district that have been held by forces loyal to the Kurdistan Democratic Party (KDP) since 2014. These fields produce 275,000 barrels of oil per day, or nearly half the 620,000-barrel output of the Kurdistan Regional Government (KRG).
Some media reports claimed that thousands of Kurdish civilians have fled Kirkuk city and its surrounding area. Other reports claimed that crowds of ethnic Turkmen who opposed Kurdish control of the city celebrated on the streets of Kirkuk. The US has not opposed Baghdad’s return to Kirkuk in part because the move was framed in terms of restoring the status quo before the Islamic State (IS) crisis. This theme has been echoed by the majority of the international community.
Separate unconfirmed reporting has indicated that Sinjar, 100km west of Mosul in Nineveh province, is now under the control of ISF/PMU forces following the withdrawal of Peshmerga forces from the town. Reporting on October 16 had indicated a build-up of government forces to the south and east of Sinjar.
Reporting last night indicated that talks were underway for a peaceful handover. Yazidi elements of the region’s majority Shia PMU forces had apparently stated their unwillingness to confront Peshmerga owing to the close ties between the groups. Reports from Diyala province have also claimed that Kurdish forces have withdrawn from positions in the Mandali district northeast of Baquba as Iraqi federal forces entered Khanaqin district to the south of Mandali.
(Source: GardaWorld)