Kurdistan Could Soon Start Shipping 250,000 Bpd Of Crude To Baghdad

The semi-autonomous Iraqi region of Kurdistan may begin deliveries by early next year of around 250,000 bpd of crude oil to the federal government in Baghdad for exports, Iraqi Oil Minister Thamer Ghadhban said.

Under an agreement from two years ago, Kurdistan is obliged to send at least 250,000 bpd to Iraqi state oil marketing company SOMO to be exported via the pipeline to the Ceyhan port in Turkey, Reuters quoted the Iraqi oil minister as saying on television late on Thursday.

The proceeds from the exports of these volumes are set to go to Iraq’s federal budget, Ghadhban added.  

In October, the Kurdistan region pumped 440,000 bpd of oil, he said.

Iraq and Kurdistan have squabbled for years about the exports from the northern semi-autonomous region, with the Kurds exporting oil on their own since 2013.

In November last year, Iraq resumed oil exports from the northern Kirkuk province, a year after it had stopped oil flows from the area due to a dispute with the semi-autonomous Kurdistan region.

Around 300,000 bpd of crude oil previously pumped and exported in the Kirkuk province to the Turkish port of Ceyhan were shut in when the Iraqi federal government moved in October 2017 to take control over the oil fields in Kirkuk from Kurdish forces after the semi-autonomous region held a referendum that Baghdad didn’t recognize. However, the only export outlet of the Kirkuk oil is the oil pipeline of the Kurdistan Regional Government (KRG). 

Iraq is now preparing to boost its oil export outlets, and plans to rebuild and expand the Baghdad-controlled oil pipeline out of Kirkuk, which is not functional currently. The expansion and reconstruction would add 1.1 million bpd of export capacity for Iraq to the port of Ceyhan. Iraq’s other key plan to boost export capacity is the construction of an artificial island south of the Al-Basrah off­shore terminal (ABOT) in the Persian Gulf, to boost exports from its key southern ports.

By Tsvetana Paraskova for Oilprice.com

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