No oil exports from Kurdistan before overdue payments solved -DNO

Genel Energy

09/11/2023 11:03

OSLO, Nov 9 (Reuters) - International oil companies
operating in Iraq's semi-autonomous region of Kurdistan will not
produce oil for pipeline exports until the issue of overdue
payments estimated at nearly $1 billion is resolved, Norway's
DNO  DNO.OL  said on Thursday.
    Turkey's closure of the Iraq-Turkey pipeline in March has
collectively cost Iraq, Kurdistan's Regional Government (KRG)
and oil producers a total of $7 billion in lost export revenues,
the Association of the Petroleum Industry of Kurdistan (APIKUR),
has previously said.
    Members of APIKUR would not restart pipeline exports until
"it is clear how they will be paid for their contractual
entitlements of oil already sold and delivered for exports and
for future sales of such oil for exports", DNO, one of APIKUR's
six members, said.
    The accumulated KRG debt to DNO for previous oil sales in
2022 and 2023 stood in excess of $300 million, the company said.
    Other APIKUR members are Genel Energy  GENL.L , Gulf
Keystone Petroleum  GKP.L , Shamaran Petroleum  SNM.V , HKN
Energy Ltd, and Hunt Oil. Collectively they produce about 50% of
the oil in Iraq's Kurdistan.
    Turkey halted flows through Iraq's northern oil export route
after an arbitration ruling in March by the International
Chamber of Commerce (ICC) ordered Ankara to pay Baghdad damages
for unauthorised exports between 2014 and 2018.
    Negotiations on the restart of flows are ongoing.  
    Iraqi government oil officials for the first time met with
APIKUR representatives on Wednesday to discuss the resumption of
flows to Turkey.
    Following the pipeline closure, DNO has partly restored
production from its Tawke and Peshkabir fields, selling its
share of oil to the local market at prices "that vary narrowly
in the mid $30s per barrel", the company said.
    Its gross production in Kurdistan continued to rise in the
fourth quarter from a daily average of 25,984 barrels of oil in
the third quarter, it added.
    Iraq, OPEC's second-largest oil producer, exports about 85%
of its crude via ports in the south. The northern route via
Turkey accounts for about 0.5% of global oil supply.    

 (Reporting by Nerijus Adomaitis; additional reporting by
Natalie Grover;Editing by Elaine Hardcastle)
 ((nerijus.adomaitis@thomsonreuters.com; +47 9027 6699; Reuters
Messaging: nerijus.adomaitis.thomsonreuters@reuters.net))