BAGHDAD, Iraq-- Iraq's ministry of oil says that it intends to retake full control of all Kirkuk oil fields that fell to the Peshmerga during the war with the Islamic State (ISIS) and that the recent rise of export from Kirkuk is part of an old agreement with the Kurdistan Regional Government (KRG) that had been temporarily cancelled due to sabotage against the pipeline that passes through Turkey.
“The oil ministry reaffirms that the old agreement still stands as it was taken into account in the last two year’s fiscal budget and that of 2017. What happened was that due to sabotage against the pipeline that passes through Turkey the ministry halted exports of Kirkuk oil through the pipes.” Iraq’s oil ministry said in a statement late Friday.
It also said no changes had been made to the 2014 December agreement that tentatively solved the lingering oil dispute between the two administrations. The ministry said that the resumption of Kirkuk oil exports will help the North Oil Company and the province financially.
“The resumption of oil exports through the Turkish Ceyhan port will bring extra income that will cover the operation costs of the North Oil Company and Kirkuk’s own share of petrodollars.” the statement read.
The Iraqi oil ministry emphasizes in the statement its intention to take back all oil wells and fields that came under Kurdish Peshmerga control two years ago.
It said: “The oil ministry will also try to retake full control of all Kirkuk oilfields that were administered by the NOC before the terrorist gangs of ISIS entered Iraqi territories and before the Peshmerga forces seized some oil wells during the previous government.”
On August 29, a top Kurdish delegation headed by the KRG Prime Minister Nechirvan Barzani visited Baghdad where he met with Iraq's Prime Minister Haidar Abadi regarding production and export of oil.
The export of crude from Kirkuk rose in late August after a ban was lifted on several oil fields in the province, increasing the total export of the crude to nearly 300,000 barrels per day (bpd) from previous 150,000 bpd.
Iraqi government's spokesperson Saad Hadisi described the visit as "a great beginning" and "an important step towards solving most of the financial problems between Erbil and Baghdad," in an earlier interview with Rudaw.
"This new step will become a starting point to implement the new deal and abide by it," he told Rudaw on August 30.
Earlier this year, Iraq's North Oil Company (NOC) halted the export from Kirkuk's three oil wells including Baba Gurgur, Khabaza and Jambouri on March 11 with an output of 150,000.
Under the terms of 2014 December agreement between Erbil and Baghdad, NOC will export only parts of its oil through Kurdish pipelines to the Turkish Ceyhan port in return for KRG administrating larger portions of the oil production in the province.
But according to the new arrangements, almost all produced oil in Kirkuk will be exported via Kurdistan pipeline with the revenues of 75000 bpd of the total of 300,000 bpd returned to the Iraqi ministry and the rest to the KRG.
The Kurdish ministry of natural resources has announced that it exported over 12 million bpd in August, worth of an estimated $350 million.