Bottom Line: As Kurdistan Region of Iraq (KRI) works towards oil and gas independence from the central Iraqi authorities in Baghdad, the next idea being floated is the creation of a national oil company and an oil and gas monetary fund to share revenues with citizens.
Analysis: Ashti Hawrami, Kurdistan’s Natural Resources Minister, is the initiator of the plan to create the Kurdistan National Oil Company (KNOC) and the monetary fund would cut all families a check of around $1,200 annually once production hits one million barrels per day, somewhere around 2015. The Ministry has sent both proposals to the parliament. Under the proposed plan, KNOC would account for 3% of Kurdistan’s total oil revenues. More broadly, the formation of a national oil company in Kurdistan would give it full control over its oil industry and cause a wider rift with Baghdad. In terms of the law, Kurdistan’s oil law mentions the eventual formation of KNOC, by name.
Recommendation: This is not a new idea, and it has been talked about in the recent past. The fact that Kurdistan just came out of parliamentary elections, though, means that any movement on this will have to wait for the formation of a new government.