Kirkuk Oil Flowing, but Locals Never See Any Money

This article was originally published by Niqash. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Where Are The Petrodollars? Kirkuk Oil Flowing Fast, But Locals Never See Any Money

The province of Kirkuk exports millions of barrels of oil per month. But nobody knows where the money is going – and as a result, local protesters say they will try to stop oil exports soon.

The northern city of Kirkuk and its surrounds are well known for their oil producing abilities. And locals know that thousands of barrels of oil are being extracted and exported from their area. But nobody seems to be seeing any kind of revenues from that oil.

The Kirkuk authorities say they have received none of Iraq’s “petrodollars” for almost two and a half years.

This is how the system should work: An agreement between Baghdad and the semi-autonomous northern region of Iraqi Kurdistan says that the Kurdish should send their oil, and the oil from Kirkuk, through the Kirkuk-Ceyhan pipeline, which transports crude from Iraqi Kurdistan to Turkey.

Revenues from these exports are supposed to go to Iraq’s central State Organization for Marketing of Oil, or SOMO, and from there it should be distributed back to Iraqi Kurdistan and other provinces, as a portion of the federal budget. In Iraqi Kurdistan’s case it is supposed to be 17 percent of the federal budget.

However this has not been happening in the agreed upon way for some time now.

“Kirkuk isn’t receiving its fair share because of the ongoing conflicts between Erbil and Baghdad,” says Ahmed al-Askari, a Kurdish member of the provincial council in Kirkuk who also heads the council’s oil and gas committee.

“We are not happy about this or about the Iraqi Kurdish policies on this. We don’t know how much oil is being exported and we know that Baghdad isn’t giving Kirkuk its rightful share of the federal budget. For some of 2013 and all of 2014 Baghdad didn’t send us any money. In 2015 Kirkuk’s oil was sold directly by the Iraqi Kurdish government. Neither group of authorities is telling us who has our oil money,” he complains.

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