KRG: More Payments Needed To Unlock Investment

The oil independents that dominate the upstream in Iraqi Kurdistan this week received the third consecutive monthly payment – albeit late. But this is not yet sufficient to unlock the investment needed to boost stagnating output.

The unreliability of payments from Iraq’s Kurdistan Regional Government (KRG) and the resultant accrual of receivables remains a key concern for international oil companies (IOCs) operating in the region. But nerves eased somewhat after the KRG on 30 November released the third in a row of $75mn monthly payments for volumes exported by pipeline via the Turkish Mediterranean port of Ceyhan.

Nevertheless, with firms continuing to hold back on investing in the KRG while they continue to assess the reliability of payments, production in the region is likely to stay relatively flat well into 2016. Output from KRG-operated fields (including disputed fields outside Iraq’s official Kurdish provinces) totaled 572,700 b/d for the first 10 months of 2015 (see table p6), but that from key fields Tawke and Taq Taq has dipped in recent months. (CONTINUED - 1576 WORDS)


table KRG 2015 Crude Export Revenues (To 16 November, $Mn)