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Re: Kurdistan Oil & Gas Development

PostPosted: Mon Sep 01, 2014 1:48 am
Author: Anthea

Gulf Keystone Returns Staff to Kurdistan as Threat Eases :ymparty:
By Anna Hirtenstein

Gulf Keystone Petroleum Ltd. (GKP) is sending staff back to Iraqi Kurdistan after U.S. airstrikes eased the threat from Islamic State militants that prompted a mass evacuation of expatriate oil workers three weeks ago.

The explorer will see some personnel return next week, and Chief Executive Officer John Gerstenlauer will travel to the Kurdish capital of Erbil on the weekend.

“The security situation looks quite stable to me,” Gerstenlauer said today by phone. “Many of the airlines are resuming routes and other operators are sending people back as well.”

The region’s energy boom was threatened when Islamic State took control of a vast swath of northern Iraq and neighboring Syria. The militants have been fighting Kurdish forces known as peshmerga just 50 miles (80 kilometers) from Erbil. Donations of weapons and ammunition to the Kurds and airstrikes by U.S. fighter jets have helped slow their advance and restore confidence in the security of the region.

Oil companies including Chevron Corp., Marathon Oil Corp., and Afren Plc evacuated personnel and halted drilling at the beginning of August. Genel Energy Plc withdrew “non-essential staff” from some of its oilfields, but said that its production was unaffected. DNO ASA may miss growth targets for its production levels, also citing service companies that evacuated workers as the cause of delays.

Gulf Keystone said that its partner Weatherford International Plc, an oilfield-services company, is sending personnel back to rigs in the region today or tomorrow.

The oil explorer reported plans to nearly double production by the end of the year, from 22,000 barrels a day to 40,000. It has a 75 percent stake in the Shaikan oilfield, one of the largest in the Kurdish region.

“With some luck, the security situation will remain stable,” said Gerstenlauer. “There is a good appetite for this type of crude internationally. My outlook for the rest of the year is optimistic.”

To contact the reporter on this story: Anna Hirtenstein in London at

To contact the editors responsible for this story: Will Kennedy at Alex Devine

Re: Kurdistan Oil & Gas Development

PostPosted: Mon Sep 01, 2014 1:52 am
Author: Anthea

Afren Probes $433 Million on Accounts After Suspending CEO

Afren Plc (AFR), the U.K. explorer in Nigeria that suspended its chief executive officer and three senior staff, expanded its probe into unauthorized payments and is reviewing about $433 million on its half-year balance sheet.

The company appointed KPMG LLP to review three transactions between the explorer and partners in 2012 and 2013, which are also being examined by the law firm Willkie Farr & Gallagher (UK) LLP hired by Afren, it said today in a statement. The probe is expected to conclude in September.

The inquiry adds to woes for the explorer that today announced interim profit dropped by half and cut full-year net production estimate to as low as 32,000 barrels a day from 40,000 barrels forecast in March. It blamed the output decline on the spread of violence in Iraq, which forced the suspension of work at the Barda Rash field in the Kurdistan region. The company declined to say when operations may resume.

“The results are substantially weaker than anticipated,” Lucas Herrmann, a London-based analyst at Deutsche Bank AG, wrote in an e-mailed report. “That being said, weakness in the underlying business is likely to be of secondary concern given the ongoing issues around corporate governance.”

Afren fell 2 percent to 97.50 pence in London, extending this year’s decline to about 42 percent.

“Despite recent challenges Afren is totally committed to delivering on our work program across the portfolio,” Toby Hayward, the interim chief executive officer, said in the earnings statement. “With numerous growth opportunities expected to drive a step-up in near-term production, cash flow and reserves, we remain in a strong position to deliver shareholder value in 2014 and beyond.”

Profit Falls

Pretax profit fell 49 percent to $133 million in the first half from the same period a year earlier, Afren said. It reiterated its $845 million full-year capital expenditure plan after spending only $293 million in the first half.

Afren also reported further delays to the Ebok project extension, with the platform not expected to be installed in the third quarter, according to a presentation on the website.

The shares have slumped by more than a third since the company announced last month it temporarily suspended Chief Executive Officer Osman Shahenshah and Chief Operating Officer Shahid Ullah after an investigation found they may have benefited from unauthorized payments. Afren yesterday said it also suspended associate directors Iain Wright and Galib Virani.

“The company is currently assessing the potential for the recovery of unauthorized payments from the suspended directors,” it said today. “At this stage no misstatements have been identified, and the board’s assessment is that based on facts to date the existing carrying values in the balance sheet are unlikely to be impaired.”

Nigeria Fields

KPMG is examining amounts on Afren’s June 30 balance sheet involving: $39.9 million of advances to partners in 2012; $93.3 million paid to partners to secure agreement to field extensions relating to the Okoro field in Nigeria; $1.9 million included in property, plant and equipment relating to the Ebok field in Nigeria; together with an associated amount of $298 million attributed to deferred tax assets, according to the statement.

The company has been in talks with partners and so far “had no reason to have any dialog or discussions with” the Nigerian government, Chairman Egbert Imomoh told analysts.

“The investigation has not to date had any impact on our partnerships and license arrangements,” Hayward said at the same presentation.

To contact the reporter on this story: Eduard Gismatullin in London at

To contact the editors responsible for this story: Will Kennedy at Alex Devine, Ana Monteiro ... ctors.html

Re: Kurdistan Oil & Gas Development

PostPosted: Tue Sep 02, 2014 2:44 pm
Author: Anthea

Disputed Kurdish oil tanker reappears off Texas coast, still full

A tanker carrying disputed Iraqi Kurdish crude oil reappeared on satellite tracking on Monday near Texas, days after having gone silent with a $100 million cargo, but the latest vessel data showed it had not offloaded at sea.

According to AIS ship tracking data used by the U.S. Coast Guard and Reuters, the United Kalavrvta, which has been in limbo for weeks, was still 95 percent full.

Its would-be U.S. buyer has balked at taking delivery of the cargo, and Baghdad has filed a lawsuit in a U.S. court saying exports by the Kurdistan Regional Government (KRG) are illegal. The KRG argues they are allowed under the Iraqi constitution.

The vessel was anchored on Monday in the Galveston Offshore Lightering Area, essentially unmoved from its previously known position.

Vessels such as the United Kalavrvta, which are too big to enter ports near Houston, use the lightering area to transfer their cargoes to smaller ships before delivery.

Baghdad has made clear it could file more legal challenges to regain control of the cargo if it comes ashore.

Several other tankers carrying crude from Iran or Iraqi Kurdistan have in the past unloaded cargoes after switching off their transponders, which makes their movements hard to track.

The partially full Kamari tanker carrying Kurdish crude disappeared from satellite tracking north of Egypt's Sinai about a week ago. It reappeared empty two days later near Israel.

And in July, the tanker United Emblem offloaded part of its cargo of Kurdish crude onto another ship in the South China Sea.

The U.S. suit shows Baghdad is stepping up a legal and diplomatic push to stop Kurdistan from exporting crude, which the Kurds say is crucial to their dreams of independence from Iraq. (Reporting By Terry Wade; editing by Jane Baird) ... B220140901

Re: Kurdistan Oil & Gas Development

PostPosted: Thu Sep 04, 2014 12:36 pm
Author: Anthea
PUK Media

Baiji Refinery will take at least a year to repair: Kurdistan minister Ashti Hawrami

Iraqi Kurdistan Regional Government's Natural Reources Minister Ashti Hawrami on Thursday said that it would take more than a year to repair the Baiji Refinery, after it was damaged in an attack by ISIS militants in June.

"After the ISIS attack it will take at least a year for the Baiji refinery to be repaired," he said at a speech during an energy conference in Istanbul.

The pipeline connecting Kirkuk with the Turkish port city of Ceyhan, would be unable to transport oil for years to come after being sabotaged, Hawrami added.

Re: Kurdistan Oil & Gas Development

PostPosted: Thu Sep 04, 2014 12:45 pm
Author: Anthea

Oryx Petroleum resumes operations in the Hawler license area of the Kurdistan Region of Iraq

Oryx Petroleum recently resumed crude oil production and sales into the domestic market at the Demir Dagh field in the Hawler license area at rates in excess of those prior to the temporary halt in August.

In the south portion of the Hawler license area, operations at Zey Gawra are secure and 3D seismic data acquisition is planned in the coming weeks.

Appraisal drilling locations at each of Ain Al Safra and Banan, in the northwest and west- portions of the license area, respectively, have been protected and security at each site has been enhanced in recent weeks.

Oryx Petroleum Corporation Limited announce an update for its operations in the Hawler license area of the Kurdistan Region of Iraq ("Kurdistan Region").

Commenting today, Oryx Petroleum's Chief Executive Officer, Michael Ebsary, stated:

"We are very pleased that tangible improvements to the security environment in the Kurdistan Region have enabled us to resume all activities at our core asset, the Demir Dagh field. The resumption of production at higher levels after only a short interruption is very positive and, while the interruption will result in delays in our development schedule, we hope to minimise those and continue our rapid ramp-up in production.

Appraisal activities at our Ain Al Safra and Banan discoveries remain suspended pending further improvement in the security environment in the westernmost portions of the Hawler license area. Preparations for drilling at Zey Gawra continue but timing of actual drilling is not yet certain.

We are encouraged by the response of the Kurdistan Region and Iraq authorities, together with the support of the international community, to the conflict in northern Iraq. We continue to closely monitor the situation in close co-ordination with authorities in the Kurdistan Region and continue to take measures needed to ensure the safety of our personnel and operations."

Demir Dagh

Oryx Petroleum recently resumed crude oil production and sales into the domestic market at the Demir Dagh field in the Hawler license area at rates in excess of those prior to the temporary halt in August. Production and sales have averaged approximately 4,300 barrels per day over the past 10 days with daily volumes achieved in recent days of over 5,000 barrels. Payments for sales have also resumed.

Expansion of production facilities has resumed with sizable capacity increases expected in the coming months. Completion of the Demir Dagh-4 well flowline is expected shortly, and preparations for installation of flowlines for the Demir Dagh-3, Demir Dagh-8 ("DD-8") and Demir Dagh-9 wells have resumed. Additionally, work has progressed to connect the production facilities to the Kurdistan - Turkey export pipeline with completion expected in the fourth quarter of this year.
(How badly damaged is the pipeline?)

The EDC Romfor 22 rig recently completed the drilling of the Demir Dagh-7 development well, reaching a total measured depth of approximately 1,900 metres in the lower Cretaceous. The rig has now spudded the DD-8 development well which is expected to be drilled to a measured depth of approximately 2,100 metres in the Cretaceous. Both wells are being drilled from the same drill pad and will be tested upon the completion of DD-8 drilling early in the fourth quarter of this year. Two additional Demir Dagh development wells are expected to be spudded before the end of this year.

3D seismic data has also been acquired over the Demir Dagh structure in recent weeks which will help delineate the field and guide selection of sites for future development wells.

Zey Gawra

In the south portion of the Hawler license area, operations at Zey Gawra are secure and 3D seismic data acquisition is planned in the coming weeks. Preparations have commenced for the drilling of a planned appraisal well at Zey Gawra prior to year end, but drilling will depend on the evolution of the security environment and the related timing of rig releases from other drilling sites in the Hawler license area.

Ain Al Safra and Banan

Appraisal drilling locations at each of Ain Al Safra and Banan, in the northwest and west- portions of the license area, respectively, have been protected and security at each site has been enhanced in recent weeks. However, the resumption of drilling and testing activities will require sustained improvements in the security environment, the timing and achievement of which are uncertain. ... cea82.aspx

Re: Kurdistan Oil & Gas Development

PostPosted: Thu Sep 04, 2014 12:51 pm
Author: Anthea

ShaMaran Petroleum resumes Kurdistan operations

ShaMaran Petroleum Corp. (TSX VENTURE:SNM)(OMX:SNM) is pleased to report the resumption of drilling operations on the Atrush block in the Kurdistan Region of Iraq on August 30, 2014. :ymparty:

Drilling operations at the Chiya Khere-8 development well were suspended for a total of 21 days by TAQA (the Abu Dhabi National Energy Company), operator of the Atrush Block, as a precautionary measure, following recent regional developments.

Civil engineering works at the Phase 1 Production Facility have continued uninterrupted during the period in which drilling operations were suspended. Mobilisation of the rig planned to drill the Chiya Khere-6 eastern appraisal well is underway.


ShaMaran Petroleum Corp. is a Kurdistan focused oil development and exploration vehicle with a 20.1% direct interest in the Atrush oil discovery, which is currently undergoing appraisal and development.

ShaMaran Petroleum is a Canadian oil and gas company listed on the TSX Venture Exchange and the NASDAQ OMX First North Exchange (Stockholm) under the symbol "SNM". Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

ShaMaran Petroleum's Certified Advisor on NASDAQ OMX First North is Pareto Securities AB. ... e4402.aspx

Re: Kurdistan Oil & Gas Development

PostPosted: Fri Sep 05, 2014 3:45 am
Author: Anthea
Bas News

Kurds Re-start Crude Oil Export by Trucks to Iran
Hoshmand Sadiq

After the truck exportation of crude oil was stopped by the Kurdistan Regional Government (KRG) for 30 days, on Thursday KRG started to resume the oil exportation to Iran through border crossings.

One of the truck drivers that export Kurdish oil to Iran spoke to BasNews and stated: 'Today [Thursday] officially Kurdistan Region’s border crossings were open for exporting crude oil via trucks to Iran.'

'30 days ago, Iran closed its border crossings with the KRG for Kurdish crude oil exportation to Abbasi Port through trucks,' said the driver.

'Kurdish crude oil get transported to Maraghayi area [Kurdish populated area in Iran] from there the oil get transported via a special train to Abbasi Port in Iran,' added the driver.

Now, in all the three crossing borders of KRG with Iran that consists of Bashmakh in Penjwen area, Parwezkhan in Garmian and Haji Omaran in Erbil, Kurdish crude oil get exported to Iran.

Last Month when Islamic State (IS) Militants attack the the border areas of Kurdistan region, Iraq closed its borders with Kurdistan region. ... Iran/32983

Re: Kurdistan Oil & Gas Development

PostPosted: Sat Sep 06, 2014 8:31 pm
Author: Anthea

Iraq Pursues New Tack in Bid to Seize Tanker Off Texas
By Laurel Brubaker Calkins and Harry R. Weber

Iraq’s Oil Ministry has asked a U.S. judge for permission to change its legal arguments in a bid to seize $100 million in Kurdish crude waiting in a tanker off Texas since late July.

Stymied by the judge’s ruling last month that he didn’t have jurisdiction under admiralty law, the nation has come back with claims under maritime and Texas statutes.

U.S. District Judge Gray Miller in Houston threw out an arrest warrant that gave federal agents authority to take the 1 million-barrel cargo and store it, at Iraq’s expense, if the tanker entered U.S. waters. Miller said he had no authority to intervene in a foreign ownership dispute under U.S. laws governing property stolen on the high seas. Iraq cited those laws as the basis for to recover crude exported from wells in the northern Iraqi region of Kurdistan without permission.

Iraq’s Oil Ministry has now revised its complaint, citing different statutes to obtain a new arrest warrant aimed at preventing the Kurdistan Regional Government, or KRG, from selling the cargo in the U.S. Iraq now cites the Foreign Sovereign Immunities Act and state law governing stolen property.

“Such request is not made to re-hash previously pleaded arguments or factual allegations but for the purpose of addressing newly discovered information revealed since the” initial filing of the complaint, Iraq’s lawyers said in papers filed Sept. 4 in Houston federal court. Harold Watson, the KRG’s lawyer in Houston, declined to comment on the filing.

The proposed amended complaint names Kurdistan, which the U.S. doesn’t recognize as a sovereign nation, and the unknown “John Doe Buyer” believed to have purchased the cargo after it left Turkey in June.
Overdue Royalties

At a court hearing last month, both the Iraqis and Kurds told the judge they’d prefer to have ownership of the crude determined by Iraq’s Supreme Court. The sides are locked in a protracted legal battle there over billions of dollars in overdue oil royalties and unpaid war-damages reparations the central government owes Kurdistan, which the U.S. considers part of Iraq.

Iraq’s lawyers said the KRG has refused to appear in its courts to address a 2012 government lawsuit seeking to block the region from exporting oil for its own benefit. They said seizing the Kurdish cargo in Texas was their only leverage to get the KRG to show up before the Iraqi high court.

The United Kalavryta had been circling within a 350-yard radius of a spot 60 miles southeast of Galveston from July 26 through Sept. 1, when a vessel tracking service lost its signal.

The signal picked up again last night, and the ship has moved about 20 miles south from that spot, according to vessel tracking data compiled by Bloomberg.

Four firms that handle lightering services for vessels entering the ports of Houston, Corpus Christi, Galveston and Port Arthur said yesterday they haven’t been hired to offload oil from the stranded ship onto smaller ships and bring it to shore.

One of the firms, SPT Inc. (1251), wouldn’t take the job if it was offered, spokesman Simon Duncan said in a phone interview.

“I would honestly think no one would touch this ship,” Duncan said. “You’re inviting the potential for arrest of your own ship. It doesn’t make sense.”

A fifth firm, AET Inc. (AET), had originally been hired to lighter the oil and later dropped the job after the dispute over the cargo arose. Two officials at vessel operator Marine Management Services M.C. of Piraeus, Greece, didn’t immediately respond to e-mails yesterday seeking comment on the status of the vessel and its cargo. They also didn’t address the question in several e-mail exchanges.

The case is Ministry of Oil of The Republic of Iraq v. 1,032,212 Barrels of Crude Oil, 3:14-249, U.S. District Court, Southern District of Texas (Galveston).

To contact the reporter on this story: Laurel Brubaker Calkins in Houston at; Harry R. Weber in Houston at

To contact the editors responsible for this story: Michael Hytha at David E. Rovella ... as-1-.html

Re: Kurdistan Oil & Gas Development

PostPosted: Mon Sep 08, 2014 9:22 pm
Author: Anthea

Genel Returns Workers to Kurdistan on Improved Security

Genel Energy Plc (GENL), the largest oil producer in Iraqi Kurdistan, is returning workers to the region’s fields after security improved.

“The decision to resume full operations has been made following a close monitoring of the situation,” the London-based company said today in a statement. Genel, which removed inessential personnel from non-producing assets in August, said output wasn’t affected and it had been pumping about 234,000 barrels of oil a day from its fields.

The U.S. expanded its air strikes against Islamic State militants, while President Barack Obama plans to rally Sunni Arab states to help him defeat the insurgents. Kurdistan explorers including Oryx Petroleum Corp. and ShaMaran Petroleum Corp. have also resumed operations in the region

Genel rose 1.6 percent to 866 pence by the London close.

To contact the reporter on this story: Eduard Gismatullin in London at

To contact the editors responsible for this story: Will Kennedy at Tony Barrett, Rachel Graham ... d-security

Re: Kurdistan Oil & Gas Development

PostPosted: Wed Sep 10, 2014 9:22 am
Author: Anthea

New Iraq oil minister faces security challenge, Kurdish dispute

Iraq's new oil minister is a veteran politician who will need to deploy all his experience to resolve disputes over Kurdish oil production and allay foreign investor fears about Islamist militia control in northern oil fields.

Adel Abdul-Mehdi, a former finance minister and vice president who was given the oil portfolio in a new government approved by parliament on Monday, is seen as welcoming foreign investment and business in Iraq.

Some Iraqi Kurdish sources say they also view him as a relatively conciliatory figure who might bring a more positive atmosphere to tense talks between Baghdad and the Kurdistan region over rights to oil production.

But he faces a daunting task, taking over when Islamic State militants are in control of swathes of land and a few oilfields in northwestern Iraq, while the Kurds are defying Baghdad by exporting crude directly via the Mediterranean port of Ceyhan.

In addition to those grave security and political challenges, he must also overcome foreign concerns over Iraq's entrenched bureaucracy and poor infrastructure -- a legacy of years of sanctions, war and internal conflict.

Any policies which Abdul-Mehdi pushes will have to run a gauntlet of sectarian tensions as the OPEC member's new leaders struggle to keep the country united.

"The challenges ahead of the new minister are very big and very wide," said Samuel Ciszuk, analyst at the Swedish Energy Agency.


Abdul-Mehdi has heavyweight political credentials which could help him. A member of a family involved in politics since the days of the Iraqi monarchy, he was in the Baath party briefly in the 1960s before Saddam Hussein seized power, then became a prominent Marxist and ultimately an Islamist.

A Shi'ite, he is a senior leader in the Supreme Iraqi Islamic Council, one of Iraq's main Shi'ite parties that has traditionally strong ties with the Kurds.

The Kurdish connection may go some way to defusing the long-running dispute between Baghdad and the regional Kurdish capital of Arbil over natural resources and territory.

The Kurds began exporting oil in May via an independent pipeline. Iraq has asked a U.S. court to seize $100 million worth of Kurdish crude oil on a tanker near Texas, and has threatened to sue potential buyers of the cargo.

Abdul-Mehdi "is an old politician who has held many posts. He is a man of dialogue and trust. I do believe he may be the best bridge between Baghdad and Arbil," said Mithal Alusi, a secular lawmaker. "He was the best choice."

A Kurdish source said: "He is a conciliatory figure. He never had any anti-Kurd rhetoric like other Shi'ite politicians, and has frequently visited the Kurdish Regional Government. I think this might be good for the Kurds."

Former deputy prime minister for energy affairs Hussain al-Shahristani - seen by the Kurds as leading a hostile policy against independent Kurdish oil development and exports - was not named for any energy-related post in Iraq's new cabinet.

Some observers see this as a goodwill gesture, showing the new government of Prime Minister Haidar al-Abadi may be willing to resolve its row with Arbil over oil resources and revenues as a step towards boosting national output.

"The main challenge now for Iraq's oil sector is to achieve a common national policy along with the required supporting legislation to enable the massive investments needed to achieve the country's production potential," Majid Jafar, chief executive of the UAE's Crescent Petroleum, told Reuters.

In addition to his domestic political challenge, Abdul-Mehdi will need to deal with the foreign oil firms which Iraq needs to exploit its oil reserves.

"The industry definitely wants somebody who understands contractual negotiations and the technicality of the oil industry," Ciszuk said.

Abdul-Mehdi does not have an oil industry background, but he was finance minister in 2004-2005. His website says he has degrees in political science and political economy from France, and previously worked as an economist.


Iraq originally set an overall oil production capacity target of 12 million barrels per day by 2020, rivalling that of top oil exporter Saudi Arabia, after it signed service contracts in 2009-2010 to develop its giant southern oilfields.

Oil majors working in Iraq include BP, ExxonMobil , and Royal Dutch Shell. The southern oilfields remain under Baghdad's control and untouched by the violence.

But crumbling infrastructure, red tape and a lack of clear oil legislation have stunted investor interest. Iraq failed to reach its targets and Baghdad has now reduced the overall capacity target to 8.5-9 million bpd, after negotiating revised plateau production rates with oil companies.

All of Iraq's oil exports now come from the south, with frequent bomb attacks on the northern Kirkuk-Ceyhan pipeline halting exports from there since February.

Abdul-Mehdi will lead efforts to raise oil exports beyond their current level of 2.4 million bpd, and will work with oil companies on developing Iraq's southern oilfields to boost output above 3.2 million bpd.

"In terms of what the minister has to deal with, it is really a continuation of the past and current challenges -- ensuring that the obligations of the government are met in executing the technical service agreements," said one oil industry source.

That includes ensuring foreign oil companies are protected and that decisions on contracts for service work, such as building new pipelines or drilling wells, are not being held up by administrative issues, the source added.

(Additional reporting by Ned Parker in Baghdad; Editing by Andrew Torchia and Dominic Evans) ... 9G20140909

Re: Kurdistan Oil & Gas Development

PostPosted: Wed Sep 10, 2014 9:24 am
Author: Anthea

Kurdish Oil and US Leverage in Iraq

HOUSTON _ As the Obama Administration ratchets up its confrontation with radical Islamists in Iraq, an idled tanker loaded with Kurdish oil off the Texas coast may provide a bargaining chip for enhancing US influence in Iraq.

The US has been seeking to persuade Iraq’s Shia Muslim-dominated government to open itself to more inclusion, especially by the minority Sunni Arab population. Bringing beleaguered Iraqi Sunnis into the Baghdad power structure is seen as a way to diminish the appeal of the Sunni extremist group known as Islamic State in Iraq and Syria, or ISIS, which is bent on establishing an Islamic state.

At the same time, Iraq’s Kurds have sought an increase in autonomy that could ultimately result in an independent state across northeastern Iraq. Kurds have asserted their economic independence by increasing their oil production and exports via Turkey.

The travails of the United Kalavrvta, which entered the Gulf of Mexico in July carrying about one million barrels of Kurdish crude, are indicative of the Kurdish Regional Government’s attempts to market oil and establish financial independence from Baghdad.

The US government has responded to the tanker’s arrival by publicly supporting Baghdad’s claim of control over Iraq’s natural resources, including those in the Kurdish north. Unable to enter US territorial waters, the cargo languishes in a sort of legal limbo.

We feel the Obama administration may be missing a prime opportunity to use the dispute to influence events in Iraq. As part of its overall strategy, Washington should consider tempering its unconditional support for Baghdad, making it conditional the government’s becoming more inclusive of Sunni Arabs and other minorities.

Manifestations of the chauvinistic tendencies in Baghdad include brutal suppression of Sunni protests and the flight of Iraq’s Sunni Vice President Tariq al-Hashimi, exiled in Kurdistan since 2011.

If US diplomats let it be known in Baghdad that, if progress were not made on issues of concern to Iraqi minorities, the Obama administration could announce its intention to recognize Kurdish autonomy in its oil production and sales efforts. If the Kurdish oil came ashore in the US, the resource ownership battle could move to US courts. If the owners of the oil were unhappy with these prospects, they could offload elsewhere.

Either way, the threat of establishing a precedent for Kurdish oil exports might focus minds within the new Iraqi administration of Prime Minister Haider al-Abadi on issues of importance to US policy in the region. The Kurdish crude would not have to be offloaded in the United States for this stance to be effective.

Why is this important? Reducing Sunni alienation from the Shia-dominated Iraqi government is crucial to the success of Obama’s campaign against ISIS. The brutality of ISIS is more tolerable in some Sunni areas because it provides an alternative to the oppressive tactics of Iraqi security forces under the sectarian dictates of former Prime Minister Nouri al-Maliki.

There are, of course, ramifications to such an approach. At a minimum it would send a signal to the world that it is OK to bypass the central government in Baghdad and import Kurdish oil. This, in turn, would boost the already rising autonomy of Iraqi Kurdistan, taking it a step closer to de facto statehood.

Recent US bombings of ISIS positions in northern Iraq – backing the Kurdish peshmerga forces – have already conferred increased legitimacy on the Kurdish quasi-state. Objection to yet another US enhancement of Kurdish autonomy might also come from Turkey, which harbors its own separatist-minded Kurdish minority. For now, Turkey and the Iraqi Kurds are allies.

The battle over Iraq’s national resource ownership has gone unresolved for a decade. Meanwhile, the possibility that Iraq may be carved up into autonomous ethnic enclaves is growing. If Baghdad is unwilling to demonstrate its commitment to power-sharing, Washington ought to outline one potential cost: an end to our opposition to Kurdish control over natural resources.

In other words, if Iraq wants to be treated as a unified state, it needs to act like one.

While we are not espousing US support for Kurdish independence, we feel that the facts on the ground already point toward greater autonomy. Beyond the oilfields within recognized Kurdish territory, the peshmerga now control the northern Iraqi oil center of Kirkuk, captured last month when the Iraqi army fled the ISIS advance.

Iraqis have diminishing opportunity to maintain the territorial integrity of their state. The United Kalavrvta offers us a prospect to highlight the importance of Iraqi unity, before hope slips away. While a decision on Kurdish exports cannot be made in a vacuum, the administration should consider how such a stance could assist in its anti-ISIS strategy, and goals for a unified, functional Iraq.

The current opportunity may be short lived. The ship turned off its transponder recently, and then switched it on again. This is a strategy used when there is a plan to unload into smaller tankers, which can then transport the crude in ways that are harder to trace.

Once that happens, the Kurdish crude will disappear into the global market and the opportunity that is sitting 60 miles from Galveston will have slipped away.

Post by Jim Krane and Ted Loch-Temzelides

Jim Krane is the Wallace S. Wilson Fellow for Energy Studies and Ted Loch-Temzelides is Professor of Economics and Baker Institute Rice Scholar; both are based at Rice University’s Baker Institute for Public Policy, in Houston.

Re: Kurdistan Oil & Gas Development

PostPosted: Thu Sep 11, 2014 3:47 pm
Author: Anthea

Kurds in New Government Reject Plan

Iraqi Kurds have acquiesced to US pressure and agreed to be part of the new government in Baghdad, but they reject a plan by Prime Minister Haider al-Abadi on how to end Baghdad’s budget blockade and move forward with Kurdish oil exports.

For the Kurdistan Regional Government (KRG), without whose participation there can be no inclusive Iraqi government, the agreement is conditional on key issues getting resolved in the next weeks and months.

A statement from the KRG Ministry of Natural Resources late Tuesday underscored that the KRG required the new government to form “a committee headed by the Federal Prime Minister and the KRG Prime Minister to tackle the mechanisms for sending the KRG’s share of the budget within one week of government formation.”

The Kurdistan Region claims it is owed nearly $8 billion for a period stretching back to January, when the then prime minister Nouri al-Maliki ordered an end to monthly payment transfers to the autonomous Erbil government, after it announced independent oil exports that Baghdad calls “illegal.”

With this committee set to meet next week, the statement added that payments of financial dues must “commence” this month, leaving space for the parties to decide on payment in full or installments.

"The Iraqi government claims they don’t have the full amount of money,” said Arez Abdulla, a Kurdish MP in the Iraqi parliament. “I believe they will send the Kurdish budget twice every month before we reach an agreement on Kurdish oil exportation."

But fellow Kurdish MP Najeeba Najeeb insisted that Baghdad is using the budget to pressure the Kurds into an oil deal.

“Iraq has enough money in the bank to pay us now -- they have been saving on our share all these months,” she told Rudaw. “They want to talk about the oil issue before sending us our budget share because they want to make sure we agree to export oil through SOMO,” the state-owned oil marketing company.

Resolving how Kurdish oil should be exported and marketed is a thorny issue. While Abadi’s plan allows for six months for a deal, the KRG says it must be resolved in three.

The Kurds reacted against a perceived ambiguity in Abadi’s proposal, writing that “all the pending issues regarding oil and gas” must be solved, no matter what. The Kurds objected to a provision that a solution must be “based on the Constitution,” fearful it might lead to an impasse: Baghdad and Erbil have had drastically different interpretations of the Constitution in the past, which has led to the current standoff.

In a further departure from Abadi’s proposal, the KRG does not specifically require that the new arrangement be enshrined in a new oil and gas law. Such a law has been notoriously difficult to pass in the past and could delay any agreement indefinitely. Nor did the KRG agree to “immediately deliver a portion of its oil production to be exported via the Federal Ministry of Oil,” in exchange for an advance on oil revenues.

But there are some significant signs of progress and hope for cooperation in Abadi’s plan that the Kurdish bloc has welcomed. Abadi calls for a peaceful solution to territorial disputes mentioned in the Iraqi Constitution’s Article 140, the highly politicized law calling for normalization, census, and referendum in Kirkuk and other disputed lands.

His proposal also mentions the arming and training of the Peshmerga forces as a National Guard Force under the umbrella of the national defense system, something that the Kurds have called for since 2005. He has bugun work on this front already: in the first cabinet session on Tuesday, Abadi asked that a draft law for National Guard troops be established in the next two weeks.

If Kurdish demands are not met within the next weeks and months, it is not clear how the Kurdish bloc would react. The KRG statement did not specifically threaten to withdraw from the government.

"If no commitment is shown… the Kurdistan Region leadership will make its decision accordingly,” it said.

Re: Kurdistan Oil & Gas Development

PostPosted: Sat Sep 13, 2014 12:15 pm
Author: Anthea

In Kurdistan: Oil Industry Ramps up despite War :ymparty:

International staff for US-based Marathon Oil will begin returning to Iraqi Kurdistan on Friday, the latest in a string of companies that decided to send employees back to the region.

Despite ongoing battles between Peshmerga and Islamic extremists on the outskirts of the Kurdistan Region, oil production is ramping back up and many energy companies are returning to business as usual.

A spokesman for the Kurdistan Regional Government’s (KRG) Ministry of Natural Resources told Rudaw, “The majority of (international oil companies) are now returning to their full work schedule with some 70 percent of blocks operational. About 95 percent of the service companies have returned and are resuming work.”

He added, “Kurdistan’s oil and gas infrastructure remains unaffected by the operations against terrorists…The Oil Protection Force is at all sites in Kurdistan and remains vigilant, having bravely prevented the terrorists from accessing oil and gas facilities.”

Oil and gas continued to flow from major fields in the KRG since the Islamic State (IS) toppled Mosul in June. However, many companies evacuated non-essential staff and international workers, especially after an IS offensive in early August came within 25 kilometers of the regional capital, Erbil, forcing hundreds of thousands of Iraqis to flee to the KRG in a matter of days.

“The main issue was the safety of staff, but most international oil companies are coming back now and resuming their normal operations,” said Shwan Zulal, who runs a consulting firm specializing in the Kurdistan Region.

“The oil industry is bullish about the prospect of oil export despite delays and setbacks,” he added, “and none has been deterred by the legal and political wrangling between Baghdad and Erbil.”

International staff for US-based Marathon Oil will begin returning to Iraqi Kurdistan on Friday, the latest in a string of companies that decided to send employees back to the region. Anglo-Turkish firm Genel Energy and Canadian Oryx Petroleum announced earlier this week that their staff would return.

Companies in the exploration and drilling phases have been more cautious. During the August offensive, US firm Hess shut down a drilling operation.

Oryx’s Ain Al Safra and Banan discovery operations are suspended “pending further improvement in the security environment in the westernmost portions of the Hawler license area,” according to a company statement.

While there may be some delays in development, however, production has actually risen during the crisis.

Genel’s Tawke and Taq Taq fields are producing 234,000 barrels per day (bpd) and exporting 182,000 bpd thanks to an upgrade to the Iraq-Turkey pipeline in Iraqi Kurdistan. Baz Karim, president of the Kar Group which owns the region’s largest refinery, stated last week that production should rise to 400,000 bpd by the end of the year.

Re: Kurdistan Oil & Gas Development

PostPosted: Mon Sep 15, 2014 3:03 am
Author: Anthea


Oil production in Kirkuk has decreased to 30,000 barrels per day since June, down 90 percent from earlier this year, Kirkuk's governor said Thursday.

Najmaldin Karim, Kirkuk's governor, attended the "Mapping the Future of Energy" conference in Istanbul, where he talked about the self-styled militant ISIS group, which has seized the oil refineries of the country.

"There have been no exports since March and the only production in Kirkuk has been the 30,000 barrels per day from a small refinery and enough gas to get our electrical grid going since June 8," said Karim. "I don't think there will be exports from Kirkuk to the Ceyhan pipeline any time soon. It has been sabotaged continuously and to get it all back would take at least a year or more."

Karim said the oil produced in the refineries since June has been used for domestic consumption and electricity production in the country.

"We Kirkuk citizens, we want the oil production to continue and we can help to bring the two sides together," he said, referring to Baghdad and Erbil. There has been continuing opposition from Baghdad to the Kurdish Regional government's exporting of oil through Ceyhan.

The Kirkuk-Ceyhan pipeline has a storage capacity of 1.6 million barrel per day.

Re: Kurdistan Oil & Gas Development

PostPosted: Fri Sep 19, 2014 9:24 pm
Author: Anthea

Chinese Consul Arrives in Erbil as Oil Talks Reported
By Alexander Whitcomb

China is set to become the fifth and final permanent member of the UN Security Council to open an official representation in the Kurdistan Region, with the arrival of the consul general in Erbil. :ymparty:

“There’s chaos in some parts of Iraq, but business in Kurdistan is moving forward,” said Karwan Jamal Tahir, the Kurdish foreign relations official who welcomed Consul General Tan Bang Len on Wednesday.

Tan’s arrival coincided with news reports that the semi-autonomous region was in negotiations with China, the world’s second-largest economy, for the sale of $4 million worth of oil – though the potential buyer has not been identified.

The Reuters news agency reported that three tankers bearing Kurdish crude have sailed toward Asia in the last month, including one that unloaded its cargo onto a supertanker outside of Singapore earlier this week.

Kurdistan has begun independent oil sales, which are vehemently opposed by Baghdad as “illegal.” So far, buyers of Kurdish oil have preferred to remain anonymous.

The consul’s long anticipated arrival comes after years of planning by the Kurdistan Regional Government (KRG) and Chinese authorities. Tan will visit Prime Minister Nechirvan Barzani during a weeklong stay; KRG officials indicate he will return once a consulate is set up before the end of the year.

The Kurdish Foreign Ministry stated that Chinese officials were very interested in the condition of Iraq’s internally displaced persons (IDPs), and that they expressed interest in providing humanitarian aid in the near future.

According to an official government directory, 17 Chinese companies are currently operating in the Kurdistan Region, including DQE, an oil and gas service company, and Beijing-based Sinopec, a state-owned energy giant that is the world’s fifth-largest company by revenue.

Sinopec entered the Kurdish market in 2009 when it took over Addax Petroleum, which had assets in Kurdistan’s Taq Taq field, as well as Africa. Sold for $7.2 billion, this was the largest-ever international takeover by a Chinese oil and gas firm.

China will be the 32nd country with a representation in Iraqi Kurdistan. Other countries such as Kuwait and Bulgaria are waiting for their paperwork to be approved in Baghdad.