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BAGHDAD/LONDON: A restart of Iraq’s Kurdish oil exports is not imminent, sources close to the matter said on Friday, despite Iraq’s federal government saying on Thursday that shipments would resume immediately.

Baghdad and the Kurdistan Regional Government have been in negotiations since February to end a stand-off that has halted flows from the north of the country to Turkiye’s port of Ceyhan. The KRG was producing about 435,000 barrels per day (bpd) before the pipeline closure in March 2023.

On Thursday the federal government said that Iraqi Kurdistan would resume oil exports immediately through the pipeline to Turkiye despite drone attacks that have shut down half of the region’s output.

But on Friday a source at APIKUR, a group of oil companies working in Kurdistan, said that a restart depended on the receipt of written agreements. Another at KAR Group, which operates the pipeline, said that no preparations had been made for a restart.

Baghdad and the companies have not yet agreed how to restart the exports, a KRG government source said, while a source at Turkiye’s Ceyhan said there was also no preparation at the terminal for a restart of flows.

On Thursday, a statement from KRG Prime Minister Masrour Barzani said the government had approved a joint understanding with the federal government and it was awaiting financial details.

Similar agreements in the past failed to secure a resumption in exports and it remains unclear if this deal will succeed.

Oil companies working in Kurdistan have previously demanded that their production-sharing contracts should remain unchanged and their debts of nearly $1 billion be settled under any agreement.

On Friday Genel Energy and Gulf Keystone Petroleum declined to comment, while DNO, Hunt Oil and HKN Energy did not immediately respond to requests for comment.

DRONE ATTACKS
Oilfields in Iraqi Kurdistan have been attacked by drones this week, with officials pointing to Iran-backed militias as the likely source of the attacks, although no group has claimed responsibility.

They are the first such attacks on oilfields in the region and coincide with the first attacks in seven months on shipping in the Red Sea by Iran-aligned Houthi militants in Yemen.

On Thursday a strike hit an oilfield operated by Norway’s DNO in Tawke, the region’s counter-terrorism service said.

It was the week’s second strike on a site operated by DNO, which operates the Tawke and Peshkabour oilfields in the Zakho area that borders Turkiye.

No casualties have been reported, but oil output in the region has been cut by between 140,000 bpd and 150,000 bpd, two energy officials said.