The Association of the Petroleum Industry of Kurdistan announced on Thursday that Iraq will repay debts for Kurdistan Region crude oil through in-kind deliveries at Ceyhan port. A designated marketer representing international oil companies will sell the oil and deposit revenues into an escrow account to secure payments. Iraq's amended Budget Law requires the Finance Ministry to provide $16 per barrel as interim compensation for production and transportation expenses.
The financial arrangement follows a September agreement among the Kurdistan Region, international oil companies, and Iraq's Federal Oil Ministry to restart exports through the Iraq-Turkey pipeline. Oil shipments from the Kurdistan Region ceased in March 2023 after an arbitration court in Paris ruled that Baghdad must approve all transfers through the Ceyhan port. The halt eliminated a significant revenue stream for both governments and reduced Iraq's participation in global energy markets.
The financial arrangement follows a September agreement among the Kurdistan Region, international oil companies, and Iraq's Federal Oil Ministry to restart exports through the Iraq-Turkey pipeline. Oil shipments from the Kurdistan Region ceased in March 2023 after an arbitration court in Paris ruled that Baghdad must approve all transfers through the Ceyhan port. The halt eliminated a significant revenue stream for both governments and reduced Iraq's participation in global energy markets.
