A state-owned energy company in the United Arab Emirates said Monday it received approval from the semiautonomous Kurdish government in Iraq to start developing an oil prospect there. With 30,000 barrels of oil per day planned from the Atrush development, the company said it's upbeat about the "tremendous potential" in the Kurdish north. Relatively shielded from the problems plaguing the rest of the country, the region has developed as something of an oil state within an oil state. Violence may once again be putting the squeeze on the Kurdish north, however.
The Abu Dhabi National Energy Co., known also as TAQA, said Monday it received approval from the Kurdistan Regional Government to start development of the Atrush block. The block is located about 50 miles northwest of Erbil, the capital of the Kurdish region, and is expected to give up as much as 30,000 bpd during the initial stages once first oil comes on stream by 2015.
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"The Kurdistan region of Iraq is an exciting exploration frontier and has tremendous potential,” said David Cook, head of oil and gas operations at TAQA.
Last week, Asthi Hawrami, the Kurdish minister of natural resources, told British delegates a pipeline to send Kurdish oil to export markets would be online in the next few months. By the time first oil is achieved from Atrush, the minister said the Kurdish region could be exporting 1 million bpd.
"We are helping the security and continuity of energy supply to the world," he said.
The Kurdish north since the U.S.-led invasion in Iraq has been isolated from much of the violence plaguing the country. In the midst of the economic recession, the Kurdish region boasted a 4.3 percent growth rate in gross domestic product. Since then, the Iraqi government in Baghdad revised its proven oil reserves to 141 billion barrels of oil, making it one of the premier oil countries in the world. In 2009, the Kurdistan Regional Government said it laid claim to 45 billion barrels of oil, which would make it the No. 9 in the world if it were an independent country.
"Through the Atrush development, TAQA is delighted to be part of the economic progress and growth in the region," said Cook.
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The north of Iraq isn't immune from regional problems, however. At least twice in August, attacks in the region have disrupted the flow of oil to a Turkish port on the Mediterranean Sea. In late September, at least six members of the Kurdish security forces were killed by attackers targeting administrative buildings in Erbil. Al-Qaida claimed responsibility for the attack and Kurdish leaders from the Iraqi Parliament said violence from Syria may be spilling across the border.
The U.N. Assistance Mission in Iraq expressed concern after "another series of bloody attacks" struck the country during the weekend. Nearly 900 people were killed in Iraq last month. In Turkey, a fragile peace with members of the PKK, a Kurdish separatist group active in northern Iraq, is unraveling. Kurdish officials at last week's conference said the region was fast becoming a factor in shaping the Middle East. Spared for the better part of 10 years, the Middle East may fast be shaping the future for the Kurds.
By. Daniel J Graeber of Oilprice.com