The Kurdistan Regional Government said the Khor Mor gas supply to Iraq’s Ministry of Electricity began without its approval and breached the contracts governing the project.
Crescent Petroleum and Dana Gas jointly operate the Khor Mor gas field in the Kurdistan Region. The companies informed the KRG on August 4 that they had started supplying natural gas to Iraq for power generation.
According to the KRG, it received the notice at the same time as the companies’ public announcement.
Khor Mor Gas Supply Was Not Approved, KRG Says
The KRG said it supports stronger energy security across the Kurdistan Region and Iraq. It has invested public funds in energy infrastructure and has made that infrastructure available to benefit people across the country.
The regional government said it has never opposed sending gas or electricity to other parts of Iraq. However, it said all such agreements must follow existing contracts and receive approval from the KRG as the contracting authority.
The KRG described the operators’ decision as a breach of their contractual duties. It also said the move interfered with the formal energy arrangements between the KRG and the Federal Government of Iraq.
The statement comes as Erbil and Baghdad work to increase cooperation in the energy sector. The KRG said both governments have made progress toward that goal.
KRG Requested More Gas for Regional Facilities
The KRG said the decision was troubling because it had asked the operators to provide more gas to facilities facing higher demand.
The regional government said it invested major public resources in those facilities. They were built to improve electricity supplies in the Kurdistan Region and support greater power generation for Iraq.
According to the statement, the operators moved forward with the new supplies instead of working with the KRG on a joint arrangement.
The KRG also rejected a public statement from the operators that thanked the regional government for supporting the supplies.
It said it did not approve, authorize or endorse the move. The KRG described any claim that it supported the decision as inaccurate and misleading.
KRG Reviews Legal and Contractual Options
The KRG said it is reviewing the legal, operational and contractual effects of the Khor Mor gas supply decision.
It said it would take appropriate measures to protect its contractual rights and preserve the framework governing the Khor Mor project. It also pledged to defend the energy interests of people in the Kurdistan Region and Iraq.
Despite the dispute, the regional government said it remains ready to work with Baghdad to increase gas production and electricity generation.
It said future arrangements should have the agreement of both governments, follow all relevant contracts and serve the interests of the public.
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