ERBIL, Kurdistan Region - Kurdistan Region Prime Minister Masrour Barzani said on Thursday that Erbil must be included in the ongoing negotiations over a major deal between Baghdad and British Petroleum to develop the disputed province of Kirkuk’s oil fields.
Last week, Iraq and BP signed a memorandum of understanding (MoU) to redevelop four oilfields in Kirkuk province despite the Kurdistan Regional Government’s (KRG) warning that the deal violates the Constitution. The British company and Baghadad are expected to sign the multi-billion dollar agreement next month.
"The area that Baghdad is talking to BP about is a disputed territory. According to the constitution, disputed territories are not a region which can be unilaterally decided by either Erbil or Baghdad," Barzani told Reuters on the sidelines of the World Economic Forum in Davos.
"We are not against the development in principle but we are against the mechanism,” he added, noting that “Practically, I don't think that we have the leverage to stop that.”
The MoU was made during Iraqi Prime Minister Mohammed Shia’ al-Sudani’s official visit to London.
“The Iraqi government is preparing to unilaterally take the oil and gas from these areas, while the Kurdish people are asking for the legitimate rights of these areas within the framework of Article 140,” KRG said in a statement ahead of the agreement.
Article 140 outlines steps to resolve disputes over areas claimed by both the federal and regional governments, including the oil-rich Kirkuk province. Successive Iraqi administrations have failed to fully implement the article.
The fields are operated by the state-run North Oil Company - one of the 16 companies comprising the Iraqi oil ministry - with its headquarters in Kirkuk.
BP has been working in Kirkuk’s oil fields since the Iraqi federal government’s return to power in Kirkuk in October 2017. Previously, Kurdish Peshmerga forces were in control of the oil fields in Kirkuk, following the collapse of the Iraqi army in 2014 during the fight against the Islamic State (ISIS).
Oil exports through the Kirkuk-Ceyhan pipeline have been halted since March 2023 after a Paris-based arbitration court ruled in favor of Baghdad and against Ankara, saying the latter had breached a 1973 pipeline agreement by allowing Erbil to begin independent oil exports in 2014.
The pipeline goes through the Kurdistan Region.
Before the halt, around 400,000 barrels per day were being exported by Erbil, in addition to some 75,000 barrels of Kirkuk’s oil.
The KRG has failed to pay the salaries of its civil servants on time and in full for a decade due to a financial crisis that further deteriorated after the oil export halt. Erbil is reliant on its local income and federal budget funds.
The KRG has repeatedly accused Baghdad of not making regular payments of its share of federal funds.
"We can no longer remain silent on how Baghdad is mistreating us and trying to cut our share in oil production and the national budget," warned Barzani on Thursday.
