Agreement for Oil Exports Reached Between Kurdistan and Federal Ministries
The Ministry of Natural Resources has officially announced its agreement with the Federal Ministry of Oil to facilitate the export of oil from the Kurdistan Region of Iraq (KRG).
In a statement released on Sunday, February 23, 2025, the KRG’s Ministry of Natural Resources indicated that the agreement was reached following extensive negotiations and coordination between the two ministries.
On February 22, the Iraqi Oil Ministry confirmed that all necessary preparations for the export of oil from the Kurdistan Region via the port of Ceyhan have been completed. Additionally, the KRG’s negotiating team highlighted the importance of establishing a prior agreement regarding the allocation of a portion of the oil for domestic consumption before the commencement of exports.
The Ministry of Natural Resources has stated that a joint technical team will be formed to inspect the oil export pipelines between the KRG and the federal authorities.
Export activities had been suspended since March 2023, when a pipeline transport of 400,000 barrels per day from the Kurdistan Region and 75,000 barrels from Kirkuk was halted following a ruling from an international arbitration court in Paris which favored the Iraqi federal government. This ruling mandated that the Kurdistan Regional Government’s oil be independently managed, requiring consent from Baghdad.
The KRG delegation reiterated that future oil exports will occur “according to the amount available.” Furthermore, both the Ministry of Natural Resources and the KRG delegation expressed their commitment to adhere to the provisions outlined in the federal budget law, which was amended by the Iraqi parliament on February 2, 2025.
Following its publication in the Iraqi official gazette on February 18, 2025, the amendment to the budget law has now come into effect.
Notably, the amendment stipulates that the cost of production and transportation for oil produced by the Kurdistan Regional Government is set at $16 per barrel, pending an evaluation by an international consulting firm that is expected to determine a more definitive estimated price within the next 60 days.
