ERBIL, Kurdistan Region - A Kurdistan Regional Government (KRG) delegation on Wednesday is set to meet with Iraq’s finance and planning ministers to discuss an agreement on Baghdad’s budget transfers to Erbil and the handover of the Region’s revenues, aiming to set a “basis for the coming months,” according to a source. The civil servants in the Region remain unpaid for June and July.
The source from the Kurdistan Region’s finance ministry, speaking on the condition of anonymity due to the sensitivity of the matter, told Rudaw that they will meet with Iraqi Finance Minister Taif Sami and Planning Minister Mohammed Ali-Tamim “to discuss the non-oil revenues of the Kurdistan Region, so that our understanding and agreement becomes a basis for the coming months.”
Regarding June salaries - which Baghdad has yet to disburse - “120 billion dinars are available [to be delivered to Baghdad] for June, but we are waiting for Iraq to officially decide to send the salaries to the account of the federal finance ministry," the KRG source said.
Oil exports through the Iraq-Turkey pipeline have been suspended since March 2023, following a ruling by a Paris-based arbitration court that found Turkey in violation of the 1973 pipeline agreement by allowing the KRG to independently export oil since 2014.
Last week, the Kurdistan Region’s natural resources ministry said that Erbil and Baghdad have reached an agreement on the mechanism of resuming the Region’s long-delayed oil exports, but more talks between Iraq and Turkey are required.
The delegation arrived in Baghdad on Tuesday and met with an Iraqi counterpart. Later that day, the Iraqi Council of Ministers gave “preliminary approval” to continue paying the salaries of Kurdistan Region’s civil servants for June, according to a statement from Iraqi Prime Minister Mohammed Shia’ al-Sudani’s office. The fate of July salaries and others remains unclear.
The budget disbursement is conditional on following the details of the resolution that the council passed on July 17.
Sudani’s office said that, first, committees established by the original resolution must finalize their work and submit a signed report to the federal Council of Ministers within one week.
Second, a specialized team must, within one week, calculate the federal treasury's share of the KRG's non-oil revenues. The KRG is then required to pay this specific amount to Baghdad, replacing the previous lump-sum figure. The calculation method must be approved by the federal finance ministry and the Federal Board of Supreme Audit.
Third, the KRG must compel oil companies operating within its territory to hand over all produced oil to the federal government, in accordance with the federal budget law and the July 17 decision, which obligates the KRG to export all of the oil produced from its fields - estimated at 230,000 barrels per day - through Iraq’s State Oil Marketing Organization (SOMO).
The decision also stipulates that the KRG will retain 50,000 barrels per day for local consumption and covering production costs, while the federal Ministry of Oil may provide refined oil products equivalent to 15,000 barrels per day if needed.
The source from the Kurdistan Region’s finance ministry, speaking on the condition of anonymity due to the sensitivity of the matter, told Rudaw that they will meet with Iraqi Finance Minister Taif Sami and Planning Minister Mohammed Ali-Tamim “to discuss the non-oil revenues of the Kurdistan Region, so that our understanding and agreement becomes a basis for the coming months.”
Regarding June salaries - which Baghdad has yet to disburse - “120 billion dinars are available [to be delivered to Baghdad] for June, but we are waiting for Iraq to officially decide to send the salaries to the account of the federal finance ministry," the KRG source said.
Oil exports through the Iraq-Turkey pipeline have been suspended since March 2023, following a ruling by a Paris-based arbitration court that found Turkey in violation of the 1973 pipeline agreement by allowing the KRG to independently export oil since 2014.
Last week, the Kurdistan Region’s natural resources ministry said that Erbil and Baghdad have reached an agreement on the mechanism of resuming the Region’s long-delayed oil exports, but more talks between Iraq and Turkey are required.
The delegation arrived in Baghdad on Tuesday and met with an Iraqi counterpart. Later that day, the Iraqi Council of Ministers gave “preliminary approval” to continue paying the salaries of Kurdistan Region’s civil servants for June, according to a statement from Iraqi Prime Minister Mohammed Shia’ al-Sudani’s office. The fate of July salaries and others remains unclear.
The budget disbursement is conditional on following the details of the resolution that the council passed on July 17.
Sudani’s office said that, first, committees established by the original resolution must finalize their work and submit a signed report to the federal Council of Ministers within one week.
Second, a specialized team must, within one week, calculate the federal treasury's share of the KRG's non-oil revenues. The KRG is then required to pay this specific amount to Baghdad, replacing the previous lump-sum figure. The calculation method must be approved by the federal finance ministry and the Federal Board of Supreme Audit.
Third, the KRG must compel oil companies operating within its territory to hand over all produced oil to the federal government, in accordance with the federal budget law and the July 17 decision, which obligates the KRG to export all of the oil produced from its fields - estimated at 230,000 barrels per day - through Iraq’s State Oil Marketing Organization (SOMO).
The decision also stipulates that the KRG will retain 50,000 barrels per day for local consumption and covering production costs, while the federal Ministry of Oil may provide refined oil products equivalent to 15,000 barrels per day if needed.
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