KRG to establish two new oil companies for exploration, marketing: Report
ERBIL (Kurdistan 24) – The Kurdistan Regional Government (KRG) plans to establish two oil companies for exploration and marketing, according to a new government report.
In the comprehensive report, a copy of which was shared with Kurdistan 24, the KRG outlines its perspective on the outstanding oil and gas dispute between Erbil and Baghdad.
It also expressed its intent to establish KROC, which presumably stands for the Kurdistan Region Oil Company, for oil exploration. The other company, KOMO, the Kurdistan Region Marketing of Oil, will be tasked with marketing and exporting the autonomous region’s oil.
The report suggested that there could be cooperation between these upcoming Kurdish companies and their Iraqi counterparts and the oil ministries in Erbil and Baghdad.
The Kurdish officials have discussed the efforts to establish the two companies with authorities in Baghdad.
In the report, the KRG also expressed its belief that Iraq’s SOMO (State Organization for Marketing of Oil) needs to be redesigned with the position of deputy head reserved for a Kurd with “veto power”.
SOMO’s bylaw also needs to be amended, the report added.
Oil and gas are one of the most contentious issues between Erbil and Baghdad. Other outstanding issues between the two governments are the Kurdistan Region’s share of the federal budget, compensation for Kurdish victims of past genocides, and the disputed territories.
The Iraqi Federal Supreme Court recently ruled that the Kurdish oil and gas dossier is “unconstitutional”, a claim the KRG has strongly rejected, describing the legal decision as “politically motivated.”
In response to the Court’s ruling, the Region’s judiciary has recently reasserted the constitutionality of the oil and gas sector.
The report said that oil revenues have to be deposited in a bank, the administration of which will be chosen by the KRG.
Even though Erbil has submitted all the necessary financial data regarding oil exports, Baghdad has failed to send its financial entitlements, according to the report.
The Kurdish authorities are continuing the negotiations with their Iraqi counterparts to solve all the outstanding issues.
During a meeting with the newly inaugurated US Ambassador to Iraq, Alina Romanowski, on Thursday, Kurdistan Region Prime Minister Masrour Barzani said that Baghdad should treat the KRG as a constitutionally-recognized region, noting that the oil and gas issue is not the only outstanding one between them.