Resumed oil exports are a major milestone in the reconstruction of the Kurdish Region’s economy. The story was widely covered in the Economist and elsewhere.
ON JUNE 1st a man in a hard hat in the blazing sun will ritually turn a switch to let oil flow through a pipeline. In oil-rich Iraq that should not warrant comment. But this operation, at the Tawke oilfield near Iraq’s northern frontier with Turkey, will be beamed live to a giant screen in a new conference centre in Erbil, capital of Iraq’s self-ruling Kurdistan region. Hundreds of leading Kurds will cheer as they watch pictures of oil being offloaded from tankers at an export facility at Khurmala, south-west of Erbil, from which it will be pumped to Baiji and into the same northbound pipeline (see map).
The reason for the excitement is that the crude is being extracted from the first newly developed oilfield to have come on stream since the Americans invaded Iraq in 2003—indeed, the first to have come on stream anywhere in Iraq for 30-odd years. It is also the first instance of exploration leading to extraction and export by private companies in Iraq since oil was nationalised in 1972. Iraq’s Kurds, who have signed a string of controversial production-sharing agreements (PSAs) with private companies, are proud that the oil is flowing anew from fields that they control.
The oil ready for export comes from two fields. One is at Tawke, developed by DNO International, a small Norwegian firm. The other is at Taq-Taq, where Addax Petroleum, listed in London and Toronto, runs a joint venture with Turkey’s Genel Enerji, which also has a stake in the Tawke show. Ashti Hawrami, the Iraqi Kurds’ natural-resources minister, praises the Turkish companies involved. Relations between Turkey’s government and the Iraqi Kurdish regional one are plainly improving….