UK-based consultancy Wood Mackenzie will assess oil production costs in Kurdistan. Iraq’s Ministry of Oil reached the agreement as part of efforts to resume and protect oil exports from the region.
Additionally, Ali Nizar al-Shatri, director of Iraq’s State Oil Marketing Organization (SOMO), confirmed the deal. He said that the News that the assessment aims to ensure uninterrupted oil exports from Kurdistan. The review will help clarify real production costs at oil fields across the region.
Moreover, Wood Mackenzie is a leading provider of energy data and analytics. The company specializes in oil, gas, renewables, and natural resources. According to al-Shatri, the firm will begin work soon and deliver a detailed cost assessment for Kurdistan’s oil sector.
Baghdad, the Kurdistan Regional Government, and oil companies reached a broader agreement in September. That deal aimed to restart oil exports from Kurdistan through Turkey’s Ceyhan port. Officials hope the Wood Mackenzie review will support this process and reduce future disputes.
Oil exports through the Iraq–Turkey pipeline have remained suspended since March 2023. Before the halt, the pipeline carried about 0.5 percent of global oil supply. The shutdown followed a ruling by the International Chamber of Commerce in Paris.
Therefore, the ICC ruled that Turkey violated a 1973 treaty. Ankara allowed oil exports from Kurdistan without Baghdad’s approval. After the ruling, oil flows through the pipeline stopped. The court also ordered Turkey to pay Baghdad $1.5 billion in compensation. The payment covers losses linked to unauthorized oil exports between 2014 and 2018.
Under current budget law, Iraq’s Ministry of Finance pays $16 per barrel for oil received from Kurdistan. This payment applies as long as deliveries stay above 230,000 barrels per day. SOMO receives this oil for export.
Kurdistan now produces about 280,000 barrels per day. The region keeps 50,000 barrels per day for domestic use. It sends the remaining 230,000 barrels per day to SOMO.
Officials believe the Wood Mackenzie review will help stabilize oil exports and improve trust between Baghdad and Erbil.
