APIKUR spox announces willingness to sell oil through SOMO

"This decision comes with the support of the Kurdistan Regional Government (KRG) and aims to address longstanding issues related to transparency and payment delays."
Col Myles B Caggins III, the spokesperson for APIKUR, speaking to Kurdistan24, June 22, 2024. (Photo: Kurdistan24)
Col Myles B Caggins III, the spokesperson for APIKUR, speaking to Kurdistan24, June 22, 2024. (Photo: Kurdistan24)

ERBIL (Kurdistan24) – Colonel Myles B. Caggins III, spokesperson for the Association of Petroleum International Kurdistan (APIKUR), on Saturday announced that member companies of APIKUR are willing to sell oil through the State Organization for Marketing of Oil (SOMO). "This decision comes with the support of the Kurdistan Regional Government (KRG) and aims to address longstanding issues related to transparency and payment delays."

In an interview with Kurdistan24, Col. Caggins outlined the benefits of this new arrangement. "Selling oil through SOMO will provide the central government of Iraq with full transparency and facilitate direct payments for oil sales," he stated. Under the previous system, oil companies experienced significant delays in receiving payments, as they depended on resolving budget issues between Baghdad and Erbil.

“These payment delays have affected not only oil companies but also civil servants and Peshmerga in the Kurdistan region, who have faced interruptions in their salaries due to political and budgetary disputes. The international oil companies (IOCs) agree with the KRG that resuming exports through the pipeline via SOMO is the best solution,” the spokesperson added.

Col. Caggins also indicated that recent tripartite discussions in Baghdad did not yield any formal proposals, prompting APIKUR to publicly suggest sales through SOMO as the optimal solution for all parties involved. He emphasized that while the Iraqi government had previously expressed concerns about being the sole authority to sell exported oil, this new arrangement would grant them the control they desire and ensure immediate payment to the oil companies.

“Currently, APIKUR member companies rely on local oil sales, producing between 200,000 and 220,000 barrels per day. This is a significant reduction from the more than 400,000 barrels per day produced when exports were conducted through the pipeline. Additionally, the global market price for oil is around $80 per barrel, compared to the local sale price of approximately $30 per barrel,” Caggins III noted.

Meanwhile, he pointed out that APIKUR is prepared to make contractual changes under specific conditions: any modifications must be agreed upon by the IOCs, KRG, and the Iraqi Ministry of Oil; fiscal terms must remain unchanged to ensure revenue stability; and there must be certainty and guarantees regarding payment for both past debts and future sales.

"Our member companies are eager to resume oil exports," Col. Caggins concluded, stressing the importance of stability and transparency for the benefit of all stakeholders involved.