KRG, Pearl Consortium settle disputes, develop gas in Kurdistan
ERBIL, Kurdistan Region (Kurdistan 24) – The Kurdistan Regional Government’s (KRG) Ministry of Natural Resources (MNR) and the Dana Gas, Crescent Petroleum Company International Limited and Pearl Petroleum Company Limited, collectively referred to as the Consortium, agreed to settle their disputes.
In a joint statement released on Wednesday, the KRG’s MNR and the Consortium announced they reached a final and full settlement and agreed to work on the development of the gas fields in the Kurdistan Region.
The Arbitration and related court proceedings were stopped and all remaining claims between them are released.
On 4 April 2007, KRG and the Consortium signed a Heads of Agreement (HoA) on Khor Mor and Chemchemal gas fields.
According to the new agreement, the KRG and the Consortium are “proceeding with an immediate further development of the HoA’s world class resources for mutual benefit as well as the benefit of the people of the Kurdistan Region and all of Iraq.”
“The KRG will immediately pay Pearl a sum of $600 million USD,” the statement said, adding that it will “also immediately pay Pearl a further $400 million USD to be dedicated for investment exclusively for the aforesaid further development to substantially increase production.”
“Pearl will increase gas production at Khor Mor by 500 million standard cubic feet per day (MMscfd), a 160% increase on the current level of production,” the joint statement said.
The KRG is also obligated to purchase 50% of the Additional Gas on agreed terms to boost the gas supply to power generation plants in the Kurdistan Region. The other 50% of the produced gas (250 mmscf/d) will be marketed and sold by Pearl to customers within Iraq or by export, the statement read.
Ashti Hawrami, the Minister of the Natural Resources, stated that the settlement opens a new chapter in the relationship between the parties and will take the development of the important natural gas sector to new heights.
Majid Jafar, CEO of Crescent Petroleum and Managing Director of the Board of Dana Gas, stated that “the settlement of all debts and restoration of full cooperation gives a positive outlook for further investment and full realization of the enormous resource potential of the HoA areas.”
Editing by Ava Homa