• Militants cause oil output of 175,000 barrels a day to halt
  • Fires still burning at two tanks in Bai Hassan oil facility

Kurdish Peshmerga forces in northern Iraq regained control of an oil field near Kirkuk, after Islamic State militants overran the facility, setting fire to two storage tanks and causing crude production of 175,000 barrels a day to be halted.

“The Peshmerga killed two Daesh suicide attackers who seized the Bai Hassan field this morning, a third blew himself up, and there is a search for others,” the Kurdish armed forces said in an e-mailed statement, using the Arabic acronym for Islamic State. “The situation is now under near-total control but the fires are still burning at the oil storage tanks.”

Five Kurdish soldiers and one oil worker were wounded in the clashes, the Peshmerga said. Earlier, the Iraqi petroleum police said production at the facility had been halted by the attack. The Peshmerga did not comment on the field’s output, and the Kurdish ministry of natural resources wasn’t immediately available for comment.

The semi-autonomous Kurdish government in northern Iraq produces and sells oil independently of the federal government in Baghdad. The central government disputes the legality of independent Kurdish oil exports and claims territory administered by the Kurds, including areas around Kirkuk.

Kirkuk Fields

Islamic State invaded large swathes of northern Iraq in June 2014, driving out the Iraqi central government’s army. Kurdish forces then took control of Kirkuk oil fields and started shipping crude from the area through their export pipeline network running to Turkey’s port of Ceyhan.

Islamic State militants also attacked a gas compression facility north-west of Kirkuk Sunday, killing four employees, according to a separate statement from the petroleum police in Kirkuk. It was not immediately clear whether the two incidents were related.

Iraq’s minority Kurds are independently developing oil reserves they say may total 45 billion barrels -- equivalent to almost a third of Iraq’s total deposits, according to data from BP Plc. International energy companies including DNO ASA, London-based Gulf Keystone Petroleum Ltd., Genel Energy Plc and Dana Gas PJSC operate in the Kurdish region.

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