Kurdistan’s oil and gas has been a force for stability and will benefit all the people of Iraq, Kurdistan Region Deputy Prime Minister Imad Ahmed told the second day of the CWC Kurdistan Iraq Oil and Gas Conference.
He said, ‘Kurdistan has good relations with Turkey and will continue to develop its relations with Iran. The Kurdistan Region has not been the cause of instability in the region, but to the contrary it has played an important and positive role in the stability of our neighbours. The whole of Iraq’s people and our neighbours will benefit from Kurdistan’s oil and gas resources.’
The Deputy Prime Minister was speaking at the closing session of the conference at which speakers concluded that Kurdistan is moving from the exploration phase to development and production.
Dr Ashti Hawrami, the Minister of Natural Resources, replying to a question about the consolidation of the oil and gas industry and the possible entry of China into Kurdistan said, ‘We are moving from exploration to production. Next year we will be talking about how much we produced and how much we exported. The direction of the industry, and the companies and their consolidation, is a market driven process. We play a role in identifying investments and technology, and will guide the process through transparency and market economy. If China, or any other country, brings technology and investment, then they are welcome.’
Nadhim Zahawi MP, Co-chair of the all party parliamentary group on Kurdistan and a member of the No 10 Energy Policy Unit, conveyed a British view on the production and export of oil and gas from the Kurdistan Region, ‘Gas coming into Europe from Kurdistan is good news for us as the gas production will bring down the prices including in the UK, and will become a supply channel to Europe ensuring its energy security.’
Credit Suisse has upgraded Genel Energy as a result of what it described as “irreversible progress” towards achieving large scale oil exports via Turkey.
Believing that the Iraqi Kurdistan oil play is now lower risk, analyst Thomas Adolff says that progress has been very impressive since 2011 and “we treat recent events – the signing of the energy agreement with Turkey last week – as irreversible progress … We believe Genel could be the bright-spot again in the UK E&P space in 2014.”
Credit Suisse lifted its price target on Genel from £12.96 to £14.30 per share; as of Friday morning the shares are trading at £10.53.
Adolff goes on to explain:
“Having finalised the energy agreements, the next step is to meet with the Government of Iraq (GOI) to reach a revenue-sharing agreement.
“Exports, however, can flow before and contractors amongst others will have the first call on revenue (i.e., under this format, they should get paid as exports begin).
“The KRG, meanwhile, agreed not to draw on its share of revenue from these exports after contractor entitlements, tariffs and payments to the UN Compensation fund widely reported to be held in an escrow account in Turkey, under the control of the KRG, until it reaches an agreement with the GOI.
“As revenue is accumulated, there will be an incentive to reach an agreement.”
Oryx Petroleum today announced a successful oil discovery at Zey Gawra in the Hawler license area.
The ZEG-1 well was flow tested at an average rate of 4,800 barrels per day of light crude oil from an 81 metre column. A Notice of Discovery has been filed by the Corporation with the Kurdistan Region Government. Oryx Petroleum is the operator and has a 65% participating and working interest in the Hawler license area.
“Hawler is proving to be a prolific license area. We are very pleased to have made our third consecutive oil discovery there this year, achieving excellent flow rates of high quality crude from the Cretaceous.
“More work needs to be done to confirm the size of the discovery but we believe it will be substantially larger than our pre-drill estimates. Importantly, the reservoir characteristics in the Cretaceous, notably the matrix porosity, confirm our experience with the other wells we have drilled in the Hawler license area.
“We are already planning our first Zey Gawra appraisal well and we are confident that the discovery will be established as commercial.“
KRG Prime Minister Nechirvan Barzani, speaking at a conference in Erbil today (Tuesday), highlighted Kurdistan Region’s contribution to the global energy market and reiterated Kurdistan’s commitment to the Iraqi constitution in the Region’s dealings with Turkey.
The Prime Minister referred to the discussions over the past two years between the Kurdistan Regional Government and Turkey on cooperation in oil and gas, which includes oil exports, and said that the framework agreement between Erbil and Ankara adheres to the Iraqi constitution.
“I have insisted at all times of these negotiations on the transparency and accountability of the export process and revenues from the Kurdistan Region. And here I would like to announce that we will invite officials from the federal government and independent third parties to observe all stages of the process.”
The Prime Minister was speaking at the third Kurdistan Iraq Oil and Gas Conference which has attracted almost 1,000 executives from the energy industry as well as senior diplomats from across the world. Iraq’s Deputy Prime Minister Rowsch Shaways, the KRG’s Natural Resources Minister Ashti Hawrami and Turkey’s Energy Minister Taner Yildiz also spoke at the opening of the conference.
The Romanian Ambassador to Iraq, Mr Jacob Prada, met with Minister Falah Mustafa today to discuss ways to further develop ties with the Kurdistan Region of Iraq. The meeting took place a day after the Romanian Consular Office hosted their first National Day celebration in Erbil.
Also present in the meeting was the Assistant Head of the DFR, Ms Siham Jabali, and the Head of Romania’s Consular Office in Erbil, Mr Mihaita Ena.
Ambassador Prada thanked Minister Mustafa and the KRG for attending and helping organise the National Day Reception. On behalf of the KRG, Minister Mustafa congratulated the Romanian government and their people on the occasion of their National Day and wished people and government of Romania prosperity and progress.
Both sides discussed the number of ways in which relations can be further developed with Ambassador Prada talking about the increase in interest being shown by Romanian companies wishing to work on medium and large scale projects in Kurdistan. He spoke about how twinning cities and provinces in Romania with cities and provinces in Kurdistan will help facilitate not only improved political relations but also increased economic ties.
Minister Mustafa expressed his hope of seeing direct flights begin between Romania and Kurdistan, emphasizing that with this step coupled with the twinning of cities, there undoubtedly be an increase in mutual relations. He also stressed the importance of cultural and educational exchanges between Kurdistan and Romania as another way to further develop relations.
Finally they discussed the local political situation in Kurdistan with Minister Mustafa briefing the Ambassador about the latest developments particularly in the area of the formation of the new KRG cabinet.
The Department of Foreign Relations has hosted a meeting for the Kurdistan Region’s diplomatic corps, providing them with the first update since the region’s elections on the political, economic and security developments both in Kurdistan as well as Iraq.
The Head of the Department of Foreign Relations, Minister Falah Mustafa, welcomed the diplomats and thanked them for the role they have played in the Kurdistan Region. He said, ‘I would like to reiterate that the doors of DFR are open anytime and we will do all that we can to ensure that you succeed in your mission.’
The meeting, the first since the parliamentary elections in September, set out to cover a wide range of topics. ‘There are a number of areas in which we can cooperate; political, economic, cultural, educational, as well as social,’ said Minister Mustafa. ‘All these areas help build bridges between governments as well as their people.’
Minister Mustafa said the running of the elections ‘was another milestone of political success in the region, as we were able to carry out the elections without any problems and the results were accepted’. He encouraged the diplomats to continue supporting KRG’s political process as they have done through election monitoring to ensure transparency and legitimacy as Kurdistan and Iraq continue their journey of consolidating democracy.
The minister also discussed the Kurdistan Regional Government ‘s policy of having friendly relations with all its neighbors includes the energy cooperation with Turkey that is set out to benefit all parties equally. “The KRG has no hidden agenda. The revenues from oil exports will go into Iraq’s national treasury,” Mr Mustafa said.
Travel experts and companies from around the world attended the Kurdistan International Tourism Conference in Erbil last week, paving the way for Erbil’s position as Middle East Tourism Capital of 2014.
The Head of the General Board of Tourism, Mawlawi Wahab made the opening remarks and welcomed the delegates who included officials from the federal Iraqi government as well as members of the international community.
Speaking on behalf of the Iraqi government, the federal Minister for Tourism and Archaeology, Liwaa Smaisim, said, “I would like to convey the wishes of the Iraqi government to the region on your success in getting Erbil selected as the 2014 Capital of Arab Tourism.” He went on to praise the rapid progress Erbil is undergoing particularly in the tourism sector with the number of visitors steadily increasing year after year.
The Governor of Erbil, Nawzad Hadi, thanked Minister Smaisim and his ministry for their assistance in securing the award. He said:
“The Kurdistan Regional Government has allocated $20 million for this project and the people of Erbil are very proud to have their city selected as the capital of tourism. We are sure that this will provide an opportunity for Kurdistan as well as a Iraq as a whole to be looked at a in a more positive light by the international community.“
The Minister of Municipalities and Tourism Dilshad Shahab, who spoke on behalf of Prime Minister Nechirvan Barzani, conveyed the Prime Minister’s gratitude to the ministries, institutions and departments that played a role in Erbil securing the award. He briefed the guests about the importance that the KRG places on the tourism sector mentioning that it has been earmarked as a priority sector in the development of the economy.