Draw Media

According to a document obtained by (Draw Media), the Legal Office of the Iraqi Oil Ministry on 15/2/2023 have responded to the proposals of the Kurdistan Region regarding the oil and gas law and rejects 10 out of 15 suggestions. The proposals have not been directed to the Kurdistan Regional Government (KRG) delegation, but instead the legal office has submitted to the Iraqi Oil Ministry.

The Iraqi Oil Ministry is against the KRG (selling oil, having its own oil and gas pipelines, having an oil and gas council, and reviving the KRG's oil and gas law after being repealed by the Federal Court).

These are the details of the recent discussions between the Kurdistan Regional Government delegation and the central government on how to write the draft of the oil and gas law. The Kurdistan Regional Government (KRG) has presented its proposal on the law in 15 points. The central government has rejected 10 points of the KRG's proposals, which is 67% of the proposals.

• Article 111 of the Constitution

One of the principles that the Kurdistan Regional Government delegation in the negotiations to prepare the draft law on oil and gas submitted to the Iraqi Ministry of Oil, compliance with Article (111) of the Iraqi Constitution.

Article 111 of the constitution states that "oil and gas in all regions and provinces belong to the entire Iraqi people."

The Iraqi government agrees with the KRG, because it believes that this article of the constitution defines a good basis for the ownership of oil and gas and does not give any rights to either the central government or the KRG.

Grant of permission

The KRG has proposed that the issuance of oil licenses should be under the authority of the parties specified in the constitution, while the contracts for the fields  in the Kurdistan region should be under the authority of the region, in accordance with Article 115 of the constitution.

The federal government rejects the proposal, saying that the constitution does not give the authority to grant oil exploration and extraction licenses to any party, but in Article 112 writes that the federal government together with the Kurdistan Regional Government will manage the oil and gas extracted from existing fields.

Transfer of ownership!

The KRG has proposed that the oil and gas law allow for the “transfer of ownership of oil and gas to others at the point of delivery”.

The central government disagrees with the Kurdistan Regional Government (KRG) on this proposal, saying that such a provision cannot be included in the oil and gas law, because it is contrary to Article 111 of the constitution.

The Iraqi government proposes to leave the regulation of the transfer of oil and gas ownership to the sales contracts signed for this purpose.

 Oil and gas policy

The KRG has proposed that the Federal Council and the Regional Council for Oil and Gas Affairs take over the preparation of the strategic oil and gas policy.

The central government opposes the KRG's proposal, saying it is unconstitutional and could open the door to the creation of councils in oil-producing provinces.

Oil and gas policy

The KRG has proposed that the Federal Council and the Regional Council for Oil and Gas Affairs take over the preparation of the strategic oil and gas policy.

The central government is against the KRG's proposal, saying that “This proposal is unconstitutional and could open the door to the creation of councils in oil-producing provinces,". In addition, it will lead to a plurality of stakeholders responsible for setting the overall oil and gas strategy.

Who should sell oil?

The KRG has proposed that the region have its own marketing company and deposit crude oil revenues into an international account under the control of the region and the revenues from the sale of oil from the federal government into another account.

The central government has rejected the proposal, saying it is contrary to the law regulating the Ministry of Oil and the rules of the oil marketing company. "The proposal also contradicts the provisions of the Financial Administration Law and the Federal Budget Law, which state that all revenues from the sale of crude oil must be deposited in an account opened for this purpose.