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Baghdad pledges Kurdish salaries in exchange for oil

November 29, 2016 at 10:40 am

Iraq’s federal government in Baghdad pledged on Monday to pay the salaries of Kurdistan employees if they agreed to deliver oil from the northern wells to the National Oil Company (SOMO).

“We welcome the statement by the Kurdistan Region Prime Minister, Nechirvan Barzani, over the transfer of oil extracted from the region and some of the Kirkuk fields to the federal government in exchange for paying the salaries of the region’s employees,” said the oil ministry. “Prime Minister Haider Al-Abadi has said on several occasions that his government is ready to pay the salaries of the region’s staff if Kurdistan transfers oil.”

Barzani told a press conference on Sunday that if Baghdad is ready to transfer the regional budget, “We are also ready to resolve differences and outstanding issues.”

According to Abadi, Iraqi Kurdistan damages the country’s revenues by extracting and exporting oil at prices lower than those of the national oil company.

An oil and energy advisor to the Iraqi parliament, Ali Al-Fayad, told Anadolu news agency on Monday that Baghdad and the regional government in Erbil have reached understandings on oil which would serve the public interest of the state. He added that the current phase requires further coordination between Kurdistan and Baghdad, especially regarding oil, because the challenges facing Iraq are held in common.

Baghdad and Erbil signed an oil deal in December 2014 whereby Kurdistan would deliver at least 250,000 barrels of oil per day to the federal government for export in addition to exporting 300,000 barrels per day from the Kirkuk fields through the Kurdistan oil pipeline. However, the agreement came to a halt in June last year after Kurdistan exported oil completely separately from Baghdad. In response, the federal government decided to suspend payment of the region’s share of the federal budget.