Iraq's Oil Minister Signals Smooth Resumption of Kurdistan Oil Exports, Timeline Set for Early March 2025
The announcement comes as officials from Iraq’s Ministry of Oil prepare to visit Erbil to finalize the details of the plan.
ERBIL (Kurdistan24) - In a statement released on Monday, Hayan Abdulghani, Iraq's Minister of Oil, confirmed that no obstacles remain to the resumption of oil exports from the Kurdistan Region.
He assured that within a few weeks, all measures for restarting the oil export process from the Kurdistan Region will be completed. The announcement comes as officials from Iraq’s Ministry of Oil prepare to visit Erbil to finalize the details of the plan.
The oil minister outlined that technical processes have been put in place and expressed optimism that Kurdistan's oil exports would resume within the first quarter of 2025. He added that there is no longer any issue halting the resumption of oil flows, and he expects to see exports take place by early March.
In another related update, Kamal Mohammed Salih, the Acting Minister of Natural Resources of the Kurdistan Regional Government (KRG), confirmed that an official delegation from the Ministry of Oil is expected in Erbil on Tuesday. The delegation will engage in discussions regarding the resumption of Kurdistan's oil exports.
The process for resuming oil exports has gained approval at the federal level, with the Iraqi parliament ratifying the federal budget law and the relevant articles that enable the resumption of oil exports from the Kurdistan Region. Salih further pointed out that the Iraqi Federal Government's stance on the resumption has been consistent, and the technical teams involved are now fully prepared for implementation.
"The federal government has officially approved the budgetary adjustments, and there are no remaining legal or financial impediments," Salih said in a statement to Kurdistan24. "We are ready to move forward with the resumption of oil exports from the Kurdistan Region."
Detailed Provisions
1: The Federal Ministry of Finance shall reimburse the Kurdistan Regional Government (KRG) from the sovereign budget for expenditures related to the cost of oil production and transportation. This applies to the portion of oil produced in the region that is collected by the State Oil Marketing Organization (SOMO) or the Federal Ministry of Oil, per clauses (A) and (B) of this section. A fair and transparent accounting process shall be implemented for production and transportation costs for each field separately, under the supervision of a specialized international technical advisory body. This body shall be designated by the Federal Ministry of Oil in coordination with the Ministry of Natural Resources in the region within 60 days of the enforcement of this law. In the event of any disputes beyond this timeframe, the Federal Council of Ministers shall appoint the advisory body.
2: The advisory body referenced in the previous clause shall present a detailed breakdown of production and transportation costs to the Federal Ministries of Oil and Finance, as well as the Kurdistan Regional Government of Iraq. These costs shall be approved to implement this law, and previous debts shall be settled based on the historical cost per barrel multiplied by the volume of crude received, as specified in clauses (A) and (B) of this section. The Federal Ministry of Finance shall then transfer the corresponding funds to the KRG.
3: The immediate transfer of oil produced in the Kurdistan Region to SOMO or the Federal Ministry of Oil, in accordance with clauses (A) and (B) of this section, shall commence. The reimbursement for production and transportation costs shall be provided by the Federal Ministry of Finance at a provisional rate of $16 per barrel. The final settlement of these costs shall be determined following the completion of the work of the specialized technical advisory body, as outlined above.
The restart of oil exports is expected to provide significant relief to the KRG's budget and economy, which has faced considerable financial strain due to halted revenues from oil exports in recent years.
The Kurdistan Region's oil exports have been a contentious issue between the federal government in Baghdad and the regional government in Erbil. After a prolonged suspension, the oil export process is set to resume following the amendments made to the budget law by the Iraqi parliament. This is a key step in normalizing economic relations and ensuring the continuation of essential revenue streams for the Kurdistan Region.