Baghdad-Kurdistan Oil Talks “Have Reached A Dead End”: KRG
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Iraqi officials are still nowhere close to reaching an agreement with the semi-autonomous Kurdistan region regarding oil payments owed to the central government, reported Reuters on Wednesday, with the impasse causing a delay in the approval for the national budget that was first drafted last October.
Iraqi officials are still nowhere close to reaching an agreement with the semi-autonomous Kurdistan region regarding oil payments owed to the central government, reported Reuters on Wednesday, with the impasse causing a delay in the approval for the national budget that was first drafted last October.
According to Reuters, Iraq’s oil minister Abdul Kareem Luabi met with a delegation from the Kurdistan Regional Government this week, but the two parties failed to resolve the dispute amid “tense” negotiations.
The KRG says it is owed more than $3.5 billion to cover the costs accumulated by oil companies operating there over the past three years, but Baghdad have rejects those contracts as illegal and has allocated just $644.33 million. Additionally, Kurdistan would like more autonomy regarding oil contracts with foreign companies, while Baghdad has insisted for all deals to seek central government approval.
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Nechirvan Barzani, prime minister of the KRG, criticised Baghdad for being inflexible over foreign oil contracts.
[quote]“Instead of warning companies to choose between the KRG or Baghdad, it’s in Iraq’s interest to cooperate more and … for the KRG and Baghdad to sit down and find a solution,” Barzani told Al-Monitor in an exclusive interview.[/quote]A spokesman for the Kurdish parliamentary bloc said that “talks over oil company payments have reached a dead-end.”
“Oil companies need to be paid and we are not prepared to bargain on payments,” he added, describing Baghdad’s posture as a tactic to scare off oil companies from the North.
On Tuesday, protesters in Baghdad called on Iraqi lawmakers to quickly approve the national budget, so as to kick-off investments and upgrades in everything from infrastructure to transport. Al Arabiya News reported that the budget standoff was costing Iraq almost $27 million per day, while Kurdish oil exports have also been halted this year as a result of the payment row.
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“It’s difficult to reach an agreement because Baghdad is dealing with this as a political issue rather than a technical one,” said Kurdish lawmaker Farhad Atroshi. A Shi’ite lawmaker from Prime Minister Nuri al-Maliki’s State of Law coalition argued however that the Kurds were not entitled to more compensation because they had not contributed their fair share to national exports.
[quote]”They have been halting oil exports for months and now they want payment: that’s not acceptable,” Abbas al-Bayati said.[/quote]
