Norwegian oil group DNO, a major oil producer in Iraqi Kurdistan, said Thursday it had resumed production at one of its oil fields closed in March due to a Turkish export freeze.
A dispute over oil has long strained relations between authorities in Baghdad, Iraqi Kurdistan -- an autonomous region in northern Iraq -- and neighbouring Turkey.
Production resumed at the Tawke field last month and it is now pumping an average of 40,000 barrels per day (bpd), DNO said as it presented its quarterly earnings report.
In March, the company announced a planned production halt at its Tawke and Peshkabir fields, which produced 107,000 bpd on average in 2022, or a quarter of Iraqi Kurdistan's oil exports at the time.
But in late March, after years of independent oil exports via Turkey, northern Iraq's Kurdish regional government had no choice but to accept a Paris arbitration court's ruling granting Baghdad the right to oversee all Iraqi oil exports.
After the court ruling, Turkey blocked the transit of Kurdish oil through its pipelines.
Half of the petrol from Tawke is today supplied to the Kurdistan regional government and the other half to local trading companies and delivered by tanker trucks, DNO said.
"While there is no light at the end of the export pipeline, we are seeing the headlights of more and more incoming tanker trucks loading up our Tawke cargoes on a cash-and-carry basis," chief executive Bijan Mossavar-Rahmani said in a statement.
The sale price is variable and on average about half what it was before the field closed, "but the payments are made quickly and directly to DNO," the group said.
The Peshkabir field remains closed.
According to a deal reached between Erbil, the capital of Iraqi Kurdistan, and Baghdad, sales are to go through Iraq's State Organisation for Marketing of Oil (Somo) and the revenue placed on a bank account managed by Erbil and supervised by Baghdad.
But the resumption of exports remains suspended pending an agreement with Turkey.
A visit by Turkey's President Recep Tayyip Erdogan to Iraq, for which no date has been set yet, is expected to see progress made on the issue.
Iraq is the second-biggest member of OPEC, exporting an average of 3.3 million barrels of crude per day.
Artificial Intelligence Analysis
Defense Industry Analyst:
8/10.
This article is highly relevant to defense industry analysts due to the long-standing conflict between Iraq and its autonomous region of Kurdistan. The article details DNOs resumption of production in the Tawke field, which is a major oil producer in Iraqi Kurdistan. This is a significant event, as it could signal a shift in the power dynamic between Baghdad and Erbil. Additionally, the court ruling that gave Baghdad the right to oversee all Iraqi oil exports and Turkeys subsequent blocking of Kurdish oil transit could have implications for regional security and stability.
Stock Market Analyst:
7/10.
This article is relevant to stock market analysts, as DNOs earnings report provides important information on its current production levels and revenue from the Tawke field. The fact that half of the petrol is supplied to the Kurdistan regional government and the other half to local trading companies and delivered by tanker trucks is an important detail, as this could affect DNOs revenue and profitability. Additionally, the fact that the sale price is variable and on average about half what it was before the field closed could have an impact on DNOs stock price.
General Industry Analyst:
6/10.
This article is of moderate relevance to general industry analysts, as it provides important information on the current state of affairs between Iraq and its autonomous region of Kurdistan. The fact that Baghdad was granted the right to oversee all Iraqi oil exports and Turkeys subsequent blocking of Kurdish oil transit could have implications for the industry, but the article does not provide enough detail to make a definitive conclusion.
Analyst Summary
:Norwegian oil group DNO has resumed production at its Tawke field in Iraqi Kurdistan, pumping an average of 40,000 barrels per day. This is a significant event, as it could signal a shift in the power dynamic between Baghdad and Erbil. The fact that Baghdad was granted the right to oversee all Iraqi oil exports and Turkeys subsequent blocking of Kurdish oil transit could have implications for regional security and stability, as well as DNOs stock price and profitability. Half of the petrol from Tawke is today supplied to the Kurdistan regional government and the other half to local trading companies and delivered by tanker trucks, with a variable sale price that is on average about half what it was before the field closed. The Peshkabir field remains closed.Over the past 25 years, there have been significant developments in the space and defense industry, including the 2003 U.S.-led invasion of Iraq and the subsequent rise of ISIS in 201
4. The articles content both correlates and contrasts with these events and trends. For example, the long-standing conflict between Iraq and its autonomous region of Kurdistan is similar to the 2003 invasion, whereas the court ruling granting Baghdad the right to oversee all Iraqi oil exports and Turkeys subsequent blocking of Kurdish oil transit is a new development in the conflict.Investigative
Question:
- 1. What are the long-term implications of Baghdads right to oversee all Iraqi oil exports and Turkeys subsequent blocking of Kurdish oil transit?
- 2. How will the variable sale price of petrol from the Tawke field affect DNOs revenue and profitability?
- 3.
What are the political implications of the court ruling for Baghdad and Erbil?4. Are there any other potential export routes for Kurdish oil aside from Turkey?
5. What are the potential impacts of the Peshkabir field remaining closed?
This AI report is generated by a sophisticated prompt to a ChatGPT API. Our editors clean text for presentation, but preserve AI thought for our collective observation. Please comment and ask questions about AI use by Spacedaily. We appreciate your support and contribution to better trade news.
