ERBIL, Kurdistan Region - The Kurdistan Regional Government (KRG) on Thursday criticized the federal government for recently withdrawing a proposal it had sent to the parliament to amend the budget law that sought the resumption of Kurdish oil exports after 15 months of halt.
“After several meetings and efforts to amend the federal general budget law by the parliament and restart oil exports from the Region, despite its first and second readings, unfortunately, it was not voted on in the final moments,” said the KRG spokesperson Peshawa Hawramani in a statement.
“We were surprised by a proposal sent to the parliament by the federal government’s representative in the legislature unilaterally and without consulting the [Kurdistan] Regional Government or being voted on by the federal Council of Ministers,” he added, noting that the introduction of a new proposal contradicts with a previous decision by the federal government.
Hours later, the Iraqi government denied it has retracted the proposal.
"We deny the claims made in the statement of the spokesperson for the Kurdistan Regional Government of Iraq, and we express our surprise at the allegation that the federal government’s representative in the parliament obstructed the amendment of the article related to procedures for resuming oil exports from the Region," Basem al-Awadi, spokesperson for the federal government, said in a statement.
In November, the Iraqi government approved a proposal to amend articles from the federal budget to authorize compensation to companies operating in the Kurdistan Region for oil production and transportation costs, setting the rate at $16 per barrel.
Iraq’s three-year federal budget bill, passed in June 2023, had set the rate for one barrel of oil at $6.90 and international oil companies (IOCs) have requested three times that amount.
The move had been welcomed by the KRG and producing oil companies.
Soran Omar, a member of Iraqi parliament’s economy committee, told Rudaw on Wednesday that Iraqi Prime Minister Mohammed Shia’ al-Sudani had retracted the proposal due to pressure from political parties, especially the Shiite ones.
According to the new proposal, the KRG must submit all revenue from oil, gas, and petroleum product sales, both domestic and international, to the federal government.
“These efforts cause damage to all of Iraq, deepen the problems, and do not serve to resolve the issues. Therefore, we completely reject and stand against these efforts and proposals. Thus, the proposal we have agreed upon must be put to a vote,” stressed the Kurdish government on Thursday.
Oil exports from the Kurdistan Region through the Iraq-Turkey pipeline have been suspended since March 2023 after a ruling by a Paris-based arbitration court ruled in favor of Baghdad over Ankara, saying the latter had breached a 1973 pipeline agreement by allowing Erbil to export oil independently since 2014.
Before the halt, Erbil exported around 400,000 barrels per day through the pipeline, in addition to some 75,000 barrels of Kirkuk’s oil.
Iraqi officials had expected the oil issue between both governments to be resolved by the end of the last year.
Updated at 10:13 pm with Iraqi government spokesperson statement
