KRG Ministry of Natural Resources

2 April 2013

The Kurdistan Regional Government Ministry of Natural Resources (KRG MNR) would like to clarify the following regarding an incident at the Sarsang block oil field which is operated by HKN Energy.

Contrary to inaccurate reports that appeared in the international media, the incident was not a serious security situation, and at no time were any attempts made to take hostages. The incident was caused by a labour dispute involving local workers who had not been paid since October last year.

Representatives of the workers asked HKN Energy to shut down operations until the dispute over the services for which they had not been paid was resolved. The dispute was resolved peacefully. At no time were any of the personnel in the field harmed and no violence occurred.

During the incident, an employee for the oil services company Schlumberger working at the site made a number of inaccurate comments to the media.

Schlumberger later issued a statement, saying the employee concerned: “was not aware of the details pertaining to the incident and consequently his statements were incorrect. Furthermore, we deny the rest of the sweeping statements that he made as they do not represent the facts on the ground or the company opinion.”

The KRG maintains an excellent level of security, and the Kurdistan Region remains a safe and secure place for foreign companies and their personnel to work and live. The KRG is committed to supporting the operations of foreign oil companies. We are also committed to ensuring local workers have a voice and are given appropriate employment opportunities in the oil sector; and to supporting social projects by oil companies in accordance with the needs of local communities.