According to a report from Interactive Investor, foreign oil companies operating in Kurdistan have been thrust into the limelight as the race for a new Iraqi Prime Minister gets underway.
There are over 25 international oil companies operating in the region, including UK-listed Gulf Keystone Petroleum (LSE: GKP) and Heritage Oil (LSE: HOIL).
AIM-listed Gulf Keystone has spoken of the risks involved in an area plagued by fervent political unrest.
“The political situation in Iraq is unsettled and volatile. The political issues of federalism and the autonomy of regions in Iraq are matters about which there are major differences between the various political factions in Iraq.
“The current situation could create uncertainty for the group, in particular with regard to validity of title of the group’s assets in Kurdistan and the allocation of revenue generated by those assets.”
Kurdistan has long lured foreign operators with the promise of a production sharing agreement that allows for greater revenue to the companies themselves and the option to list reserves on their books – a major draw for shareholders of public listed companies.