Potential energy routes and energy security were discussed in a syposium in Brussels, according to a report from AKnews.

The participants highlighted what it calls “the Turkish attempts to monopolize energy supply to the EU”, as well as the significance of Kurdish energy for the West.

The event was organised by the Friedrich Naumann Foundation and the Transatlantic Institute, and was attended by more than 50 diplomats, politicians and international experts.

Speakers included Louis Bono (Counselor for Energy in the United States Mission to the EU); Holger Krahmer (Member of the European Parliament from Alliance of Liberals and Democrats); and, Jason Isaacson (Global Jewish Advocacy), AKnews reported.

The speakers stressed the importance of diversification of energy sources and alternative lines of transmission in order to reduce the energy dependence of Europe and the West.

Bono from the United States Mission to the EU emphasized the important potential of the Kurdistan Region’s oil and gas resources for the West and pointed out that only a sustainable solution of the Kurdish and other ethnic and neighborhood problems in the region can guarantee the security of the energy corridors.

In January, former Austrian Chancellor Dr. Wolfgang Schüssel said Europe should also diversify sources of energy supply by “looking, for instance, in the Federal Kurdish Region (Iraq).”

“Europe needs additional pipelines and alternative energy distribution flows. The Kurdish part of Iraq may become alternative partner of Europe.”

The participants in the Brussels meeting also alluded to “attempts by countries like Turkey to monopolize the energy supply for EU”.

Currently, Kurdistan has a capacity of 100,000 bpd and is expected to develop its fields to increase the output to 200,000, according to Kurdistan Regional Government (KRG) Minister of Natural Resources, Ashti Hawrami.

RWE, a key shareholder in the Nabucco project which is aimed to bring up to 31 billion cubic meters of gas per year to Europe through Turkey, announced it had signed a cooperation deal with the KRG to develop and design its “domestic and export gas transportation infrastructure… creating a route to market for Kurdistan’s major gas reserves.”

(Source: AKnews)

The Iraqi government has formed a committee to discuss its numerous disputes with the Kurdistan Regional Government (KRG), AKnews reports.

Salam Yaseen, an economic adviser to the Iraqi government, told AKnews that the committee will discuss a range of issues with the Kurds including the oil and gas exports by the KRG that recently caused uproar in Baghdad.

The Kurdish and Iraqi governments have had deep disagreements for years over the management and control of oil resources in the country’s northern Kurdistan Region.

Recently disputes took another turn when the KRG announced the signing a new deal with the German utility company RWE to export gas to Europe.

He said the committee will soon start its work to resolve the differences over KRG’s gas exports.

Meanwhile, Iraq’s deputy oil minister told AKnews that so far oil and gas disputes between the KRG and Iraqi government have remained unresolved.

Assem Jihad said improving the relations between the KRG and Iraqi government will help increase Iraq’s crude oil exports.

The Iraqi government had already said some regional countries were trying to “complicate” the relations between the Kurdish government and Baghdad.

The Iraqi government has frequently objected to the oil and gas contracts between the Kurdish regional government and foreign firms saying it is a violation of the Iraqi constitution. But, Kurds insist that their contracts are constitutionally valid.

(Source: AKnews)

Reuters reports on Sunday that the cut in Baghdad’s allocation of fuel to Iraqi Kurdistan is related to the admission last month that the region is has been exporting petroleum products through Iran.

We reported at the weekend that the cut was in response to the new gas agreement between the Kurdistan Regional Government (KRG) and the German company RWE, which Baghdad regards as illegal.

The decision to cut supplies to the semi-autonomous Kurdish Regional Government was ordered by Oil Minister Hussain al-Shahristani, Oil Ministry documents obtained by Reuters showed.

“Based on instructions from the oil minister, it was decided to cut the allocation of kerosene and diesel fuel sent to provinces in the Kurdish region by 50 percent until further notice,” one document said.

Shahristani has said any exports of crude oil would be illegal because the law only allows the State Oil Marketing Organisation (SOMO) to sell crude abroad. But he has also complained about the resale of refined products because Iraq does not produce enough to be self-sufficient and has to import.

Kurdish officials condemned the decision to restrict kerosene and diesel supplies to their region, and said they would make every effort to ensure fuel prices did not rise.

“The decision to cut fuel supplies is unjust and we will do our best to stop any negative implications,” Serwan Abu Bakir, a senior official at the Kurdish natural resources ministry, told Reuters on Sunday.

Tensions between central government in Baghdad and the KRG have been increasing in recent months.

(Source: Reuters)

Baghdad has increased the stakes in the row that has flared up over the new German/Kurdish gas contract.

Last week we reported on the dispute relating to KRG’s agreement with German energy giant RWE.

Now AKnews reports that the Iraqi oil ministry said last week that it will cut Kurdistan’s fuel share in half as a punitive measure.

A senior energy official in Kurdistan says the Iraqi government has not yet enforced that decision, and there are no shortages in the region. There are reports that fuel prices have risen.

Speaking to AKnews, Nouraddin Hamid, Erbil’s general director of fuel distribution said gas keeps coming to Kurdistan from refineries under Iraqi government’s control without any problems.

“If the decision is put into practice, the KRG will identify a plan to prevent fuel crisis,” Hamid said.

“We believe that a fuel crisis is unlikely to emerge in the Kurdistan Region because the KRG is doing its best to prevent it,” he added.

Kurdistan mostly depends on refineries run by the Iraqi government for its fuel, most notably Beji [Baiji] oil refinery in northern Iraq.

Last month, Kurdistan’s energy and natural resources minister said a large refinery near Erbil will be opened soon. The new refinery is expected to provide a large part of Kurdistan’s fuel needs.

Meanwhile the German government has refused to get involved in the dispute.

(Sources: AKnews, Reuters)

The German government has refused to be drawn into the row over RWE’s new gas agreement with the Kustdistan Regional Government.

The Iraqi oil ministry has said the agreement is illegal because the country’s oil and gas are federal resources to be administered centrally.

Asked about the dispute, a spokesman for the German economy ministry said:  “RWE is a consortium member of the Nabucco project, which is of central importance for the diversification of European gas supply. RWE is responsible for its own business decisions.”

Germany and RWE hope the project can go forward but are reportedly taking a cautious line.

“It is not up to the German government to judge the legality of the aforementioned contract,” Stefan Bredohl told a regular government news conference in Berlin.

In a statement, RWE said, “we are very much aware that we have to speak with all relevant authorities in Iraq, and are taking steps now to prepare for the dialogue with the government in Baghdad”.

(Source: Reuters)

We reported yesterday on the new gas deal between the Kurdistan Regional Government and the German giant RWE.  Today, a new row has broken out between Erbil and Baghdad regarding the legality of Kurdish oil and gas contracts.

Aswat al-Iraq reports that the Iraqi Oil Ministry, through the State Organization for Marketing Oil (SOMO), claimed on Sunday to be the only party in Iraq that is exclusively responsible for exporting oil and gas from the country.

“Any other side in Iraq is not authorized to sign contracts with international and local firms in this regard,” the ministry said in a statement.

It explained that any commitments in this regard made by any parties other  than the ministry are meaningless.

“Any contracts signed out of the legal and official forms used by SOMO are considered invalid and illegal,” the ministry stressed.

Hitting back at those statements, KRG’s spokesman Kawa Mahmoud, speaking to AKnews, said the KRG’s oil and gas activities are not illegal and are compatible with Iraq’s Constitution.

He added the revenues will be for the benefit of Iraq but there are those “who do not care about the country,” in an apparent reference to Hussein al-Shahrestani, Iraq’s oil minister.

“We care about Iraq and the income of our exports will go to a special account to serve all Iraqis. Preventing such deals will harm all Iraqis because the revenues will be used for public projects whether in Basra or Kurdistan,” Mahmoud said.

Meanwhile, Sherwan Haidari, a member of the Kurdistan parliament, told AKnews that the statement by the Iraqi oil ministry is only aimed at creating obstacles for the KRG’s oil policies.

(Sources: AKnews, Aswat al-Iraq, Reuters)

Prime Minister Barham Salih today announced the signing of a Cooperation Agreement between the Kurdistan Regional Government and RWE.

The RWE Group is a leading European utilities company headquartered in Essen, Germany. It has extensive experience in the building, modernisation, and upgrading of energy infrastructure.

Under the agreement, RWE will provide assistance to the KRG in the development of a gas transmission and distribution network (including grid planning), and training aimed at increasing technical skills of the citizens of the Kurdistan Region.

“This is a major step forward in our planning,” the Prime Minister said. “RWE will bring the know-how and insights of one of Europe’s most important gas distribution companies to Kurdistan. We will be planning and designing our local gas transmission and distribution network using the most modern techniques.”

The Prime Minister added, “Kurdistan is blessed with much gas. Before any export, our gas will be used to meet the needs of the people of the Kurdistan Region and neighboring areas. These resources are being developed for the people of Iraq in accordance with the Constitution. Gas not needed at home will be available for export.”

The KRG Minister of Natural Resources, Dr Ashti Hawrami said in London in June that the Government anticipates that the Kurdistan Region will have gas reserves of between 100 and 200 trillion standard cubic feet – more than enough to meet all domestic requirements and to generate substantial revenues for Iraq from the sale of excess gas to Turkey and Europe.

Gas from the Kurdistan Region is expected to be exported via the Nabucco pipeline, which will directly link major fields in the Caspian region and the Middle East to European consumer markets. At a meeting in Ankara this week, the Nabucco project steering committee confirmed plans to source gas from two feeder lines in Georgia and Iraq.

Speaking after meeting with Natural Resources Minister Ashti Hawrami, Stefan Judisch, CEO of RWE Supply & Trading GmbH, said: “I am delighted to have been able to discuss with the Minister of Natural Resources Mr Hawrami the ways in which we can take forward rapidly the various actions set out in the agreement which we have signed. This is to the mutual benefit of the region and RWE.”

He added: “We hope to very soon reach agreement on supplies of gas from the Kurdistan Region of Iraq. This will underpin strong progress we are making elsewhere on preparing construction of the Nabucco pipeline in the near future. I have been heartened by the genuine welcome my colleagues and I have received in Erbil, and struck by the real sense of security and strong entrepreneurial spirit in its business community. This is a part of the world in which companies like ours can and will do business”.

(Sources: RWE, Kurdistan Regional Government)