KurdistanObserver.com
Kurdistan Oil Ripe For
Investment
IRBIL, (Southern Kurdistan),
March 12 (UPI) -- Iraq's Kurdistan region has the potential to rival Caspian and
North Sea oil and natural gas, analyst Wood Mackenzie says.
Kurdistan is a semi-autonomous region in the
north of Iraq, relatively free from violence like the rest of the country.
Governed by the Kurdistan Regional Government, it has also signed five
production deals with international companies, with more expected this year.
"Speculative estimates for total reserves
potential of the region are between 12 billion and 45 billion barrels of oil,
and 100 (trillion cubic feet) of gas, which would put Kurdistan on a par with
prolific producing regions such as the Caspian and North Sea," said Iain Brown,
manager of Middle East Upstream Research for Edinburgh, Scotland-based Wood
Mackenzie.
The region is well placed, with access to both
refineries and pipelines to ship crude to the rest of the country, as well as
neighboring Syria and Turkey. But it faces two distinct challenges: Syria,
Turkey and Iran fear any further independence for Iraq's Kurds would motivate
their populations to clamor for independence as well. And, although a tentative
deal has been reached on a federal hydrocarbons law, the KRG and Baghdad still
have to agree on specifics for control over signing and administering oil
production deals, as well as revenue sharing mechanisms.
Without the law, smaller, independent oil
companies may be the only ones willing to sign deals with the KRG, and
potentially hurting chances of signing deals with Baghdad for work in the rest
of the country.
The Wood Mackenzie report highlights testing
and production at the Tawke and Taq Taq fields, proving the region is ripe with
oil and could spell a boon for the region and those invested in it.
"Early entrants have shown that it is an area
where exploration activities can be successfully concluded, and have trodden a
path in which others are certain to follow," Brown said.
