DNO: First Payment under Kurdistan Receivables Settlement

DNO ASA, the Norwegian oil and gas operator, today reported the first payment from the Kurdistan Regional Government under the recently concluded agreement covering outstanding receivables for past crude oil deliveries.

Under the agreement effective 1 August 2017, the Company was assigned the Government’s 20 percent interest in the Tawke license as well as three percent of gross Tawke license revenues payable monthly over a five-year period.

The payment of USD 4.02 million to DNO represents three percent of gross Tawke license revenues during August.

An entitlement invoice for that month’s export deliveries has been issued separately and will be shared pro-rata with Genel Energy plc upon receipt.

Following the receivables settlement, DNO’s stake in the Tawke license stands at 75 percent with Genel holding the balance.

(Source: DNO)

Federal Forces Advance on Kirkuk City

Iraqi Security Forces (ISF), Counterterrorism Services (CTS), Federal Police (FP), and Popular Mobilization Units (PMU) launched a combined offensive with intent to seize the K1 military base, Kirkuk airport, and Kirkuk’s oilfields at around 0200hrs (local) on October 16.

The offensive followed two days of failed negotiations after the government of Iraq demanded Kurdish forces withdraw from the disputed areas around Kirkuk and cede control to Iraqi federal forces.

Crisis talks on October 15 failed to resolve the standoff as Kurdish leaders refused Iraqi government demands to reject the referendum result.

Clashes were subsequently reported to have broken out between Iraqi and Kurdish forces south of the city of Kirkuk.

Iraqi state media said that federal troops had entered disputed territories occupied by the Kurds, saying they had taken control of ‘vast areas’ without opposition from the Kurdish Peshmerga.

Kurdish officials, however, denied that the Iraqi forces had been able to get close to Kirkuk city and said that the oil fields west of the city were still under Kurdish control.

The Kurdistan Region Security Council (KRSC) said in a statement that federal forces were advancing along two routes along the Taza-Kirkuk intersection and Maryam Bag Bridge, both South of Kirkuk.

Separate reports claimed artillery fire could be heard to the south of Kirkuk city in the early hours.  An initial statement by the US state department said it was ‘very concerned’ about reports of a confrontation and was ‘monitoring the situation in Kirkuk closely’.

Oil prices reported to have jumped early on October 16 amid reports of the clashes in Kirkuk.

(Source: GardaWorld)

OMV Pockets $107m from KRG Settlement

By John Lee.

Austria’s OMV has said its third-quarter clean operating result “was positively impacted” by about 90 million euro ($107 million) following a settlement over a dispute relating to the Khor Mor and Chemchemal fields in Iraqi Kurdistan.

On August 30, 2017, the Kurdistan Regional Government (KRG) and Dana Gas , Crescent Petroleum and Pearl Petroleum Company Limited reached a settlement under which the KRG agreed to immediately pay $1 billion to the consortium to settle the long-running legal dispute.

Of the EUR 90 million, OMV received approximately 60 percent as dividend from Pearl while around 40 percent was put into a dedicated accountfor future investments in Khor Mor.

(Source: OMV)

KRG Makes Payments for July Oil Exports

Genel Energy has announced that the Taq Taq field partners have received a gross payment of $10.39 million from the Kurdistan Regional Government for oil sales during July 2017.

Genel’s net share of the payment is $5.71 million.

Gross oil sales from the Taq Taq field in July 2017 averaged 14,873 bopd, including both exports and Bazian refinery deliveries.

DNO ASA, as operator of the Tawke field, has also announced that the Tawke field partners have received a payment of $39.50 million from the Kurdistan Regional Government as payment towards July 2017 crude oil deliveries to the export market from the Tawke licence. The funds will be shared pro-rata by DNO and Genel.

(Source: Genel Energy)

Petrofac in Kurdistan Deal with Gazprom Neft

Petrofac has secured a three-year master services agreement (MSA) to support Gazprom Neft Middle East B.V. with the provision of engineering services on a call-off basis for the Garmian field in the Kurdistan region of Iraq.

The MSA was secured following a competitive tendering process and augments Petrofac’s extensive footprint in Iraq, where it has been providing engineering, operations, maintenance and training services since 2010.

Gazprom Neft has been Operator of the Garmian field since early 2016. Through the provision of engineering services Petrofac aims to support the planned brownfield works to debottleneck and expand the Central Processing Facility (CPF).

Steve Webber, Senior Vice President, Petrofac Engineering & Production Services, East said:

We are delighted Gazprom Neft has selected Petrofac as one of its key suppliers in support of the Garmian field CPF upgrade project.

“We have been working with this key client in Iraq for more than three years and hope to take this opportunity to build on our relationship through the demonstration of Petrofac’s fit-for-purpose and value-driven engineering solutions in the Kurdistan region.

(Source: Petrofac)

Taq Taq September Production Below Average

By John Lee.

Genel Energy has announced that production at its Taq Taq field in Iraqi Kurdistan, in which it has a 44 percent working interest, averaged 13,475 barrels per day in September.

This is considerably below the 2017 year-to-date average of 19,398 barrels per day.

(Source: Genel Energy)

Iran Bans Oil Products Shipment to Iraqi Kurdistan

Iran’s Ministry of Roads and Urban Development warned companies against shipment of oil products to and from the Iraqi Kurdistan “until further notice”.

The decision is in line with Tehran’s series of measures in response to a referendum held in the semi-autonomous region on possible secession from Iraq which has drawn international criticism.

“Given the recent developments in the region, it is suitable that international transportation companies and drivers active in this field avoid loading and carrying oil products to and from the Iraqi Kurdistan Region until further notice,” a directive by the ministry’s Road Maintenance and Transportation Organization said.

“It should be noted that the consequences of any action in this regard would befall the relevant company,” it added.

The transportation is mostly carried out by tanker trucks which take crude oil from the Iraqi Kurdistan to Iran and carry back refined products to the region.

The Iraqi Kurdistan Region went ahead with its plan to hold the referendum on Monday while Iraq’s neighbors and countries in the Middle East, including Iran and Turkey, had voiced opposition to such a move and supported the Baghdad central government.

On Monday night, thousands of Kurdish people in favor of KRG’s secession from Iraq took to the streets in Erbil, with some waving Israeli flags to celebrate.

No one in the region, except Israel’s Prime Minister Benjamin Netanyahu, endorsed the referendum, and all neighbors have warned that the secession plan would bring instability to the region and disintegrate Iraq.

Pressure has been building on officials in Erbil, Kurdistan’s regional capital, over the referendum, with regional carriers, including Turkish Airlines, Egypt Air and Lebanon’s Middle East Airlines submitting to Baghdad’s request to suspend their flights serving Iraqi Kurdistan.

(Source: Tasnim, under Creative Commons licence)

Putin boxed in by Iran, Turkey on Iraqi Kurdish referendum

From Al Monitor. Any opinions here are those of the author, and do not necessarily reflect the views of Iraq Business News. 

Russian President Vladimir Putin had been banking on Iraqi Kurdistan Region President Massoud Barzani.

Over the past year, Russia has invested over $4 billion in the Kurdistan Region’s energy sector, overtaking the United States as the largest investor. By making such a commitment to northern Iraq, Putin was likely counting on both an eventual energy windfall and another card to play as a regional broker at the expense of the United States.

He could count on good, or at least working, relationships with Damascus, Tehran, Ankara, to some extent Baghdad and, with the massive oil and gas venture, Erbil.

What the Russian president had not banked on was that Barzani would go ahead with the independence referendum on Sept. 25 against widespread international and regional opposition. The Kremlin, of course, could not support ethnic separatism, and was probably hoping for a last-minute deal with Baghdad to stave off the vote.

As the prospects of a postponement collapsed, Barzani likely saw Russia’s investment as a hedge against the nearly unified international opposition to its referendum on independence.

Putin, of course, kept up appearances of being in control, but there was no denying the unusual nature of his visit to Ankara on Sept. 28 for consultations with Turkish President Recep Tayyip Erdogan, just three days after the referendum vote.

Erdogan’s position was predictable and blustery, including when he said, “No one has a right to throw our region into the fire,” as Yekaterina Chulkovskaya reports. But Putin sought to dial it down, and instead referred to the Russian Foreign Ministry’s statement, which included the phrase “Moscow respects the national aspirations of the Kurds” and the hope for a “constructive and respectful dialogue, with a view to devising a mutually acceptable formula of coexistence within a single Iraqi state,” as reported by Jasper Mortimer.

Iraq seeks to collect KRG’s Oil Revenues

Iraqi Prime Minister Haider al-Abadi has hinted that his government wants to take control of revenue generated from Kurdish oil exports.

The measure is the latest of a set of actions taken by Baghdad against the Kurdistan Region for carrying out last week’s referendum that saw a 92-percent vote for independence, the first of which saw a ban in international flights to and from the Kurdish region.

Abadi said in a tweet that his government wanted to pay monthly salaries of KRG employees with money from Kurdish oil sales.  “Federal government control of oil revenues is in order to pay KR (Kurdistan Region) employee salaries in full and so that money will not go to the corrupt,” Abadi tweeted.

The Kurdistan Region has described the Iraqi-imposed flight ban, and other measures as “collective punishment,” that, among others, affect the wounded Kurdish Peshmerga who need medical treatment abroad, and Yezidi survivors of IS atrocities.

Amanj Rahim, the secretary of the Kurdistan Regional Government (KRG), told the Kurdish parliament on September 30 that the oil export through Turkey’s Ceyhan pipeline was going ahead as normal.

Separately, Prime Minister Haider al-Abadi reassured Kurdish citizens they will remain secure even as the government escalates its measure against their region’s government over the recent referendum on independence.

You are citizens of the first degree, we will not allow any harm to you and we will share our loaf of bread together,” Iraqi Prime Minister Haider al-Abadi said, addressing Kurds via twitter on September 30. “To our people in the Kurdistan region: We defend our Kurdish citizens as we defend all Iraqis and will not allow any attack on them,” Abadi added.

(Source: GardaWorld)

Post-Referendum Threats And Demands

This article was originally published by Niqash. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Iraqi Kurdish Politicians Talk About Post-Referendum Threats And Demands

While many uncertainties remain about Iraqi Kurdistan’s referendum on independence, there is one thing that seems clear to the people on the streets: On the day, the semi-autonomous region felt united in a way that it has not been for a long time.

Part of the reason Iraqi Kurdistan has remained an oasis of relative calm and security, while the rest of Iraq fell apart during the recent security crisis caused by the extremist group known as the Islamic State and earlier, is that the Kurdish people have always considered their ethnicity more important than the religious sect they belong to.

Ethnicity has trumped religion in their case and, despite infighting, has tended to unite locals in this area, with the long-term goal being to form their own nation.

In many other situations recently, the Kurdish have been divided – often between the two zones that basically make up the semi-autonomous northern region, which are run by the two major political parties, the Kurdistan Democratic Party, or KDP, and the Patriotic Union of Kurdistan, or PUK.

Up until the very last minute some of the region’s political parties remained opposed to the referendum. The KDP, the PUK and the Kurdistan Islamic Union had supported the referendum while the Change movement, also known as Goran, and the Islamic Group of Kurdistan wanted it postponed.

Just one day before the referendum though, when it became clear it was going ahead, the Islamic Group of Kurdistan relented and senior members said they would be voting “yes” in the poll.

Even the Change movement, a long-time opposition group in the region that formed on an anti-corruption platform, told members to follow their own consciences. Then the movement also told members they should vote, and that they should vote “yes”.