KRG Ministry of Natural Resources

3 December 2012

Speech by KRG Prime Minister Nechirvan Barzani
At the CWC Kurdistan-Iraq Oil and Gas Conference

Saad Palace Conference Centre, Erbil 

Excellencies, distinguished guests, ladies and gentleman, welcome to Erbil. Welcome to the Kurdistan Region of Iraq.

I am happy to participate with you all today, to listen, to learn about, to discuss and debate the vital issues surrounding the oil and gas industry in the Kurdistan Region of Iraq.

Thank you to the CWC Group for bringing them all together.

Ladies and gentlemen,

The people of the Kurdistan Region have come a long way from the suffering of the past. We are excited about our future and about building a peaceful and prosperous Region where the benefits of a growing and diversified economy can improve the lives of all our people and inspire the rest of Iraq.

We all know that for much of Iraq’s modern history, particularly during dictatorship, the wealth derived from our natural resources has been abused. Instead Iraq used the wealth from its natural resources to buy weapons and upgrade its military, which led to oppression both at home and in waging wars against its neighbours.

Today the Kurdistan Regional Government is determined to change these old repressive policies. We are determined not to allow Iraq’s tragic history to repeat itself.

The safeguard is Iraq’s federal constitution of 2005, which was ratified by the majority of the Iraqi people, and which enshrines the rights of the Iraqi people in all the Regions and governorates over the ownership, management and control of Iraq’s natural resources for the benefit of all Iraq’s citizens.

If it is to succeed, the new Iraq must be based on sharing both power and wealth.

That is what the Constitution demands and that is what guides every action taken by the KRG to develop a modern, progressive and sustainable oil and gas industry.

Of course there are some disagreements between the KRG and certain officials in Baghdad who think that only they have the right to control and manage oil and gas, but the federal Constitution says otherwise.

Now we see other governorates in Iraq are following our example and also pushing for their Constitutional rights.

Baghdad always uses the budget and natural resources as a means to punish the Kurdistan Region, which is very unfortunate, while we are determined that these issues can only be resolved by using the Iraqi constitution and agreements.

The days of dictatorship, unaccountable institutions and centralised economic mismanagement should be consigned to the dustbin of history.

Iraq’s oil and gas revenues must be used to help and support the aspirations of the current and future generations, and not to buy expensive weapons and create crises involving the country in more problems.

Our sound investment policies since 2003, Iraq’s federal Constitution in 2005, and Kurdistan’s Oil and Gas Law of 2007 have underpinned the rapid acceleration in the pace of development of the oil and gas industry in the Kurdistan Region. 

We are using our natural resources lawfully and prudently, and the KRG will continue to pursue sustainable development at home and mutually beneficial trade relations abroad which will benefit all Iraq’s people.

We believe that oil policies should be based on cooperation and coordination, not confrontation.

The Kurdistan Region is now firmly a part of the regional and indeed global energy equation.

The estimated 45 billion barrels of oil reserves and 3 trillion cubic metres of gas are significant.

Here I would like to thank in my name and on behalf of the KRG all the oil and gas companies that are working in the Kurdistan Region who with full confidence have come here and invested with their own capital to search and explore for oil.
Their presence here as well as the contracts signed with them are legal and in adherence to the constitution. Here I would like to thank Dr. Ashti Hawrami, the Minister of Natural Resources, and support him because of the pivotal role that he has played in advancing the oil and gas policies in the Kurdistan Region.

Our economic policies in the Kurdistan Region have been the key factor in accomplishing these many discoveries, and our achievements here in the oil and gas sector should be embraced by all Iraqis.

As a result of the rapid progress in the last five years, hundreds of millions of much-needed reconstruction dollars have flowed into Iraq’s federal treasury. We hope that Iraq will use this money for construction and development.

Next year, we anticipate being able to export on average at least 250,000 barrels of oil per day.  The Kurdistan Region’s oil production stands to generate more than $8 billion for Iraq’s treasury.

We will continue on this path and are on track to export 1 million barrels per day by 2015 with existing discoveries and 2m barrels per day by 2019 with expected discoveries.

This is related to investment and discoveries in the oil fields, but more importantly we must also focus on how to get the oil to market. Not just from the fields in the Region but from the other areas of the north of Iraq.

With the right export infrastructure in place, by 2019 over 3 million barrels of oil per day could be flowing through Kurdistan to international markets.

At the same time, we are working to identify bottlenecks in the export infrastructure, to create the right investment scenario, and to get more oil to the market.

This means building additional feeder and export pipelines for Iraq, and that is what we are doing, in line with the authority that the Iraqi constitution has given the provinces of the Kurdistan Region.

Our plans are in the implementation stage to provide sufficient oil, gas and gasoline for inside the Kurdistan Region, so that we can have enough supply to meet the demands of the people of Kurdistan and so that we no longer have to worry about threats related to cutting our supply of hydrocarbons.

But let no one characterise this policy as a threat to Iraq’s unity or as exceeding our authorities. 

Under the Constitution, the export and marketing of Iraq’s oil or gas from Iraq is not the monopoly of any single entity provided that the revenues are shared fairly among its people.

Our policies, our achievements and our contracts are entirely consistent with Iraq’s constitution, and I stress again, the benefits will be shared by all Iraqis.

Our approach is also in line with the need to help stabilize oil markets through increased production at a moment of significant international tension.

So let us not get lost in the fog of futile ideological debate. The oil and gas in the Kurdistan Region will find its way to the international markets.  Our pipeline plans are moving ahead.

Here, I would like to once again warmly welcome our friends and partners whose presence here today is an important reminder of our cooperation in the fields of energy and natural resources, and this will be a support to further develop our historical and cultural relations.

Building a productive and enduring relationship with the international community, as well as our neighbours, has been a major focus of KRG policies.

Distinguished guests,

We know that security and stability are basic components of any successful investment regime. We take our responsibilities in this area very seriously.

Kurdistan has been and will remain a pillar of security within Iraq. Our security forces such as the Asayish, police and peshmerga do an excellent job in a challenging environment.

We all know the horrors that violence and extremism can bring, and the key to their success is that they have the support of our people. Our people want to live in peace and prosperity far from any kind of violence and conflict.

I will not try to pretend that in the Kurdistan Region we are free of problems, we are a transitional stage and the road to development is long and sometimes difficult.

However, we remain committed to work hard through dialogue to resolve all outstanding issues with Baghdad within the framework of the Iraqi Constitution.

We hope that a federal hydrocarbon law will be passed soon to stabilize the relationship between the petroleum operations in both Kurdistan and the rest of Iraq. But it must be in line with the Constitution, otherwise it will be worthless.

We need a revenue-sharing law to transparently and fairly arrange the collection and distribution of Iraq’s revenues.

In addition to this, we need to begin plans to put a system in place to ensure that oil and gas revenues are shared with the people so that all citizens can benefit today -- and into the future -- from the blessing of our natural resources. I would like to reiterate that Power-sharing is a vital factor for the success of the political process in Iraq.

We in the Kurdistan Region only want to look forward. We will reject all efforts that try to recreate the authoritarian ways of the past.

Our goals for Iraq are simple and principled – we want a federal, pluralistic, and democratic system that serves the needs of all Iraqis, and protects the economic and political freedoms we cherish.

We want to make certain that our energy resources are used to improve the lives and dreams of our people, to provide security, prosperity, and a higher quality of life for all.

Thank you once again for coming and attending, and I hope this conference is a success.