Sept. 24 (Bloomberg) -- Iraq’s government will start making payments to international oil companies working in the northern Kurdish region next week, said Ashti Hawrami, natural resources minister in the Kurdistan Regional Government.
The federal government will initially pay two thirds of 1 trillion dinars ($858.3 million) and will complete the payment later, he said today at a conference in Istanbul, without being more specific on the time frame.
Iraq’s central government reached an accord earlier this month to end the dispute over payments related to international oil companies operating in the country’s semi-autonomous northern Kurdish area. The disagreement, which had prompted the Kurds to halt crude exports for about four months this year, had escalated after Exxon Mobil Corp., Chevron Corp. and Total SA, committed to doing business in the region.
The Kurdistan Regional Government plans to complete oil and gas export pipelines direct to Turkey in the next two years that will end the Kurds’ reliance on the central government’s infrastructure. Those links are due to be operational by early 2014, Hawrami said. The oil pipeline will have a capacity of 1 million barrels a day, he said.
The Kurdish region’s oil exports are due to reach 1 million barrels a day by 2015 and gas export capacity through Turkey may rise to as much as 15 billion cubic meters a year, he said, without specifying by when.
Kurdish authorities are in talks with a number of international oil companies for future energy contracts, he said, without giving more details.
Iraq’s Kurdish area is exporting 140,000 barrels of crude a day and will raise daily shipments to 200,000 barrels next year, Nechirvan Idris Barzani, the KRG prime minister, said in a statement published by the official KRG website Sept. 20. Iraq holds the fifth-biggest crude reserves, according to data from BP Plc that include Canadian oil sands.
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