BAGHDAD – The Kurdistan Regional Government, or KRG, confirmed Monday that it had received an initial 650 billion Iraqi dinars ($547 million) payment for oil companies working in the autonomous region in northern Iraq from the central government in Baghdad, a spokesman for the Kurdish ministry of natural resources said.
"We can confirm receipt by the KRG of the first portion of the money which is 650 billion Iraqi dinars agreed with the central government to pay international companies working in Kurdistan," the spokesman told Dow Jones Newswires.
Earlier this month the KRG and the federal government in Baghdad resolved issues relating to oil payments to foreign companies producing crude oil in the region and Kurdish control of oil exports from Kurdistan. According to the agreement, Baghdad would pay the KRG IQD1 trillion, some IQD650 billion out of which will be paid now, while the remaining IQD350 billion will be paid either by the end of this year or the beginning of 2013, depending on the central government's budgetary procedures.
This month's agreement comes after KRG suspended crude oil exports of nearly 100,000 barrels a day in April, citing a $1.5 billion backlog owed by Baghdad. It restarted them on Aug. 7, in what it said was a "goodwill gesture," but said flows would be halted if no payments were forthcoming by Aug. 31. The KRG later extended its deadline to Sept. 15.
The KRG said it had exported around 140,000 barrels a day last month and is planning to raise exports to 200,000 barrels a day from the beginning of this month until the end of this year.
The Kurdish region hopes to set an average export target of 250,000 barrels a day in the 2013 federal budget, according to the Kurdish minister of natural resources Ashti Hawrami.
"In 2015, we are hoping to reach an average of 1 million barrels a day," Mr. Hawrami said.
Resumption of exports from Kurdistan, has already sent up Iraq's crude oil exports to 2.6 million barrels a day in September from around 2.5 million barrels a day in August.
This month's agreement resolves only part of a broader impasse between Baghdad and Kurdistan about the control of oil resources and territory.
Copyright (c) 2012 Dow Jones & Company, Inc.
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