After amending the budget law, this is how the oil file will be managed in the Kurdistan Region, 5 FEB

 After amending the budget law, this is how the oil file will be managed in the Kurdistan Region

 The Parliamentary Finance Committee revealed, today, Monday, the mechanism for managing the oil file in the Kurdistan Region after voting on amending Article 12 of the Federal Budget Law.

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Committee member, Moeen Al-Kazemi, told {Euphrates News} that: “The amendment of Article 12 of the federal budget that took place will allow the federal Ministry of Oil to resume exporting Kurdistan Region oil with a capacity of 400,000 barrels per day through the SOMO company and deposit the oil sales proceeds in the treasury of the Ministry of Finance after the export was halted for more than 20 months from March 2023.”
He added, “This export will add an important addition to the state’s treasury,

 and there will also be a new outlet for export other than the southern outlets through the Turkish port of Ceyhan, in addition to benefiting from this pipeline instead of disrupting it, which may lead to the imposition of fines on Iraq in the event of continued disruption of this pipeline that was established in agreement with Turkey.”

Al-Kazemi pointed out, “It will also allow the federal Ministry of Oil to supervise the oil fields in the region and follow up on the current production for local consumption away from the 400,000 barrels per day, as there are 70,000 barrels per day consumed locally and must be followed up and calculated within the local revenues of the Kurdistan government.”
He added, 

“The amendment will also allow the federal government to follow up on the non-oil revenues in the region, which amounted to 4 trillion dinars in 2024 for border crossings, taxes and fees, and were not delivered, considering that there is a deficit in the region’s allocations, and the amendment to Article 12, Second/C, will leave no room for the regional government to evade handing over non-oil revenues to the federal government.”

Al-Kadhimi pointed out that “the important issue is to eliminate problems between the federal and regional governments,” calling for “balanced relations and harmony within the state administration coalition.”
He explained that “the federal Ministry of Oil is the one that will sign contracts with oil importers in the region, and oil revenues and sales amounts will be deposited in the Iraqi government’s account/the US Federal Reserve, then the Central Bank of Iraq, and finally in the Ministry of Finance.”  

Al-Kadhimi noted that “the Ministry of Finance will pay the region $16 for each barrel of oil as extraction and oil costs as a first stage until the actual costs are determined through an agreement with an international specialized technical body that accurately determines the costs.” 
The member of the parliamentary finance committee concluded his speech by stressing that “the issue of oil revenues will be entirely in the hands of the federal government, but as for non-oil revenues, there must be credibility and transparency from the regional government and opening a new page and ending previous arguments through the consensus that was reached to amend Article 12.”

Wafaa Al-Fatlawi 

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