PM Barzani stresses formation of oil, gas law with Baghdad as foremost priority

ERBIL, Kurdistan Region – Kurdistan Region Prime Minister Masrour Barzani on Tuesday said that the formation of a joint hydrocarbons law between Erbil and Baghdad is crucial for the resolution of outstanding issues between the two which are currently jeopardizing the Region’s ability to administer its natural resources.

“We have an understanding to stop pressure [from Baghdad] until we work together to draft a new law for the hydrocarbons and then we present it to the parliament and that new hydrocarbons law will be the anecdote solution to all these issues,” Barzani said during a top regional forum in Erbil, with Baghdad being the host of a pressure campaign against international oil companies (IOCs) operating in the Region.

Barzani previously expressed his support for the new government under new Iraqi Prime Minister Mohammed Shia’ al-Sudani, hoping for a “new beginning between Erbil and Baghdad – one that fosters cooperation over conflict and dialogue over confrontation.”

“Iraq still lacks an oil and gas law … together, we can work on an oil and gas law and send it to parliament,” the Kurdish premier added, offering his support to Baghdad in drafting a much-needed hydrocarbons law with tensions high between the two governments.

Tension between Erbil and Baghdad has been high since the Iraqi Federal Supreme Court in February deemed the Kurdistan Region’s oil and gas law “unconstitutional”, hence striking the independence of the Region’s energy sector and jeopardizing its industry. The Kurdistan Regional Government (KRG) has repeatedly challenged the constitutionality of the court’s ruling.

After he was tasked with the formation of the new government and appointed prime minister-designate, Sudani said that the upcoming Iraqi government will be committed to work “according to the constitution” in strengthening the relationship between Erbil and Baghdad, and “settling disputes and issues that have been lingering for a long time.”

“The cabinet was able to stand on its own feet despite all challenges,” Barzani proudly said, commending the undisrupted distribution of public salaries despite Baghdad cutting the Region’s share of the budget, the repercussions of the COVID-19 pandemic, as well as ongoing oil and gas issues between the federal government and the Kurdistan Regional Government (KRG).

“We want to cooperate and be involved in the strategic topics in Iraq so that we do not miss out on things. If we are a part of Iraq, then we need to be involved with decision-making,” PM Barzani added, stressing that the participation of the Kurdistan Region’s residents in the political process in Baghdad is very positive for the country’s climate.

While extending a hand of support to Baghdad, the Kurdish PM stated that the Region “can become a gateway” for other places in Iraq to experience success, adding that they would be willing to share progress made towards the government’s push for digitalization.

The Iraqi government has threatened foreign companies to suspend their operations in the Kurdistan Region’s oil sector and warned against new contracts with the KRG, with former oil minister Ihsan Abdul Jabbar warning IOCs that should they continue operations northward in the Region, then they will be “working in the smuggling of oil.”

However, despite pressure from the federal government, the KRG pocketed a net amount of about $1.5 billion in crude oil sales between April and June, selling a barrel of oil for $100.

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