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Date set for resuming oil exports from Kurdistan via Turkish port of Ceyhan

 

11/18/2024

- Baghdad

Acting Minister of Natural Resources in the Kurdistan Regional Government, Kamal Muhammad, set today, Monday (November 18, 2024), the date for resuming oil exports from Kurdistan via the Turkish port of Ceyhan.

Mohammed said in press statements followed by "Baghdad Today", "The halt of oil exports to Iraq and the Kurdistan Region causes a loss of one billion dollars per month."

He added that "the Iraqi parliament approved the resumption of oil exports from the Kurdistan region," indicating that "it is expected that oil exports will resume through the port of Ceyhan as of the beginning of next year."

On Saturday (November 16, 2024), economic expert Nabil Al-Marsoumi confirmed that re-exporting Kurdistan oil would cause Iraq to lose $5 billion, while he pointed out that it would cause a budget deficit .

Al-Marsoumi said in a post on Facebook, followed by Baghdad Today, that “the Kurdistan Oil Industry Association  (APIKUR)  welcomed the proposal to amend Article 12 of the budget law, but believes that there is sufficient scope in the current wording to cover its previous requests related to commercial terms and to ensure payments for past and future exports through the Iraq-Turkey oil pipeline  .” 

He added that "the amendment stipulates that the Federal Ministry of Finance shall compensate the Kurdistan Regional Government from sovereign expenses for the costs of production and transportation, for the quantities of oil produced in the region that are received by SOMO, or the Federal Ministry of Oil, provided that the fair estimated costs of production and transportation are calculated for each field separately, by a specialized international technical advisory body, determined by the Federal Ministry of Oil in agreement with the Ministry of Natural Resources in the region," indicating that " The costs of production and transportation are compensated by the Federal Ministry of Finance as advances, at a rate of (16) dollars per barrel, to be settled later after the completion of the aforementioned specialized technical advisory, and retroactively from the date of commencement of delivery .

Al-Marsoumi continued, “According to the results of Deloitte’s audit of previous years, the region only received 44% of oil revenues, and the rest was received by foreign oil companies to cover the costs of production, transportation, marketing, and profits of Foreign companies specified in most contracts as 20% of the profit oil after deducting the costs amounting to 40% of the price of a barrel of oil to recover part of the costs incurred by foreign companies when investing in the oil sector in " Kurdistan  ."

He explained that "in light of these facts and because of Iraq's commitment to OPEC Plus restrictions, the amount of Kurdistan's exports of 400,000 barrels per day will require reducing the same amount from the central and southern fields, which will lead to a decline in oil." revenues of about $5 billion annually, which means an increase in the budget deficit by the same amount due to the differences in costs and profits of foreign companies and the lower quality of Kurdistan’s oil .” 

He explained that "the solution lies in Iraq's request for OPEC Plus to exempt it from the mandatory and voluntary cuts imposed on the production quota so that there is economic feasibility in re-exporting oil from Kurdistan."

 

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