The Kurdistan Regional Government (KRG) in northern Iraq is boosting its oil exports this month from 500,000 barrels per day (bpd) to 575,000 bpd, a Kurdish official said Saturday, following a revamped oil agreement with Baghdad.
“The KRG was exporting 500,000 barrels of oil on a daily basis before, but after it signed an agreement with Baghdad over exporting oil from Kirkuk through the Kurdish pipeline, the KRG’s oil exports will increase to 575,000 bpd,”
Dilshad Shaaban, deputy head of the energy and industry committee in the Kurdish parliament, told Rudaw.
He said that Kurdish oil fetches a lower price internationally than Brent, the global benchmark.
The quality of KRG oil is low compared to Brent oil, so the price hovers around $30 to $35 a barrel” he explained. Brent is currently selling at about $47 per barrel.
Last week’s oil agreement in Baghdad followed a meeting Monday between Kurdish Prime Minister Nechirvan Barzani and Iraqi Premier Haider al-Abadi.
At least 150,000 barrels per day (bpd) of oil from Kirkuk will be jointly exported to Turkey by Erbil and Baghdad, according to the new accord.
The agreement will mean that 75,000 bpd will be exported by the Kurdistan Region and an equal volume by Baghdad to the Turkish Mediterranean port of Ceyhan, the sources said.
The oil will come from Kirkuk’s Baba Gurgur and Khabaza oilfields.
Shaaban described the increase in Kurdish oil exports as “significant,” saying the extra revenues would go to pay back KRG debts since 2014 that went to paying the salaries of civil servants.
“When the KRG’s budget was cut in 2014, it borrowed $1.8 billion to pay the salaries of employees and civil servants. Now, we could repay the debt with oil money,” he said.