UPDATE:Iraq Kurd Minister:In Nabucco Supply Talks With 3 Firms
February 02 2010 - 12:29PM
Dow Jones News
Iraq's Kurdistan Regional Government is in talks with three
companies to supply natural gas to the Nabucco pipeline, the
region's oil minister said Tuesday.
Speaking to reporters, Ashti Awrami said "it is our right" to
negotiate the use of gas from the region, adding "the revenue is
for Iraq."
Nabucco, which will bypass Russia by carrying gas from the
Caspian region to Europe, has faced concerns it may struggle to
find the quantities needed to fill the pipeline.
The minister wouldn't disclose the companies involved, but
Austria's OMV AG (OMV.VI) and Hungary's MOL Nyrt. (MOL.BU) are both
investors in both the KRG and the Nabucco consortium.
The KRG estimates its soil could hold 200 trillion cubic feet of
recoverable gas reserves.
A final investment decision for the 3,300-kilometer pipeline is
due by year end with completion expected in 2015.
While Iraq's central government struggled to expand its oil
projects amid political uncertainty and insecurity, the
semi-autonomous Kurdish region signed up a string of foreign
companies contracts in recent years. But in October, the KRG let
local operators interrupt exports after Baghdad refused to
compensate for their production.
Iraq's oil ministry has deemed the KRG contracts invalid. Awrami
suggested he wasn't aware of any progress since Iraqi Prime
Minister Nouri al-Maliki contacted the KRG to settle the dispute
last month.
Asked when exports could resume, he said "the answer is in
Baghdad," adding "we are ready to resume exports within 24 hours"
if a solution is found. Despite this, he stuck to a previous target
of exporting 100,000 barrels a day early 2011 and one million
barrels a day in 2014.
In addition, the minister said the KRG would add 150,000 barrels
a day of refining throughput within two years to 60,000 barrels a
day currently produced or close to come on stream.
-By Benoit Faucon, Dow Jones Newswires; +44 207 7842 9266;
benoit.faucon@dowjones.com
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