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Established in 2006 as a Community of Reality

Welcome to the Neno's Place!

Neno's Place Established in 2006 as a Community of Reality


Neno

I can be reached by phone or text 8am-7pm cst 972-768-9772 or, once joining the board I can be reached by a (PM) Private Message.

Established in 2006 as a Community of Reality

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    Kurdistan Gas Exports: Reality or Mirage?.. The Washington Institute Identifies Challenges and Oppor

    Rocky
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    Kurdistan Gas Exports: Reality or Mirage?.. The Washington Institute Identifies Challenges and Oppor Empty Kurdistan Gas Exports: Reality or Mirage?.. The Washington Institute Identifies Challenges and Oppor

    Post by Rocky Tue 18 Oct 2022, 4:41 am

    Kurdistan Gas Exports: Reality or Mirage?.. The Washington Institute Identifies Challenges and Opportunities for the Kurdish Dream

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    Economy News - translation
    A research paper issued by the Arab Gulf States Institute in Washington (AGSIW) sheds light on the Kurdistan region's ambition to increase Kurdish natural gas production and expand exports to Turkey and possibly the European Union, concluding that this will require a political deal with Baghdad, investments from Arab Gulf states, and security guarantees. from other stakeholders.
    The paper translated by "Al-Iqtisad News" and written by the researcher at the institute, Berivan Saeed, and titled "Kurdistan Gas Exports: Reality or Mirage?" was analyzed. Challenges and opportunities for expanding Kurdish natural gas production and exporting it to Turkey and Europe, stressing that the past several months, geopolitical developments have given the Kurdistan Region of Iraq an opportunity to include itself in the international energy discussion as a potential source of gas.
    The report added that "the opportunity was primarily driven by the Russian-Ukrainian war and the warming of relations between some Gulf Arab states with Turkey on one side and Israel on the other. The improved relations between former opponents of the Kurdistan Regional Government provided a new opportunity to revive the idea of ​​expanding gas production and export. That is why It has sought to market itself as a potential solution to Turkey and Europe's dependence on gas."
    However, “the KRG still lacks both institutional capacity, foreign investment, and support to expand its gas production to the export level. It currently cannot meet its domestic needs, which is critical to achieving public support for gas expansion. The KRG does not have the military power to confront Baghdad, and does not have sufficient political and legal means to prevent the Iraqi government from using the courts and parliament to take decisions against the fragile energy sector."
    The research considered that “the recent gas export claims of the Kurdistan Regional Government are mostly a public relations campaign. It is an attempt at regional and international diplomacy and its importance in the field of energy amid rising energy prices and the global quest for more oil and gas, where the Kurdistan Regional Government sees an opportunity. But this opportunity limited by legal, practical, geopolitical and intra-Kurdish challenges."
    “The KRG has managed to grab international headlines by presenting itself as an untapped frontier of natural gas that will satisfy Turkey and Europe’s energy needs. But this also appears to have stirred up already established natural gas powers, such as Russia and Iran,” he explained. Accordingly, the recent Iranian missile attacks are likely to be a message to the Kurdish authorities about their gas export ambitions.Without Baghdad’s coordination and agreement and understanding with its neighbors, the KRG’s unrealistic pursuit of energy adventures may be politically costly to the Kurds and is unlikely to open the way for gas exports. Widely".
    The research concluded that “the Kurdish authorities will not be able to increase gas production and expand sector development unless several conditions are met. First, the KRG needs to secure long-term purchase agreements with potential buyers. The KRG has already signed a 50-year energy agreement with Turkey.” In 2013, however, the terms of the deal were not disclosed, making it difficult for private sector energy companies to risk investing without understanding what this agreement entails and whether the deal has political support, for example, from Ankara in the event of a conflict with the Iraqi federal government. .
    Investing in gas is “more financially risky than oil. It requires a significant upfront investment, which is not refundable if projects go off track for any reason. Therefore, from a financial point of view, it is unlikely that energy companies will put their capital into The Kurdish gas sector without legal and political pre-determined.
    The report pointed out, "Another problem facing the Kurdistan Regional Government is that Kurdish gas is of low quality in undeveloped fields, such as Bina Bawi. The gas is sour and requires processing facilities to purify it. This would add billions of dollars to operating costs and lengthen the time needed to make the fields." commercial".
    These facts could "frighten investors from developing these fields, especially in the absence of long-term purchase agreements between the KRG and potential buyers."
    Moreover, “such additional costs could make Kurdish gas more expensive and less competitive compared to Iranian and Russian gas. For these reasons, the KRG needs to start negotiating with potential buyers for long-term purchase deals to clear the way for the oil companies.” Global investment in the gas sector in the Kurdistan region if it wants to be able to reach the full potential of the gas sector.”
    The biggest challenge to Kurdish gas development is “the Kurds themselves. Oil development used to have a Kurdish consensus in the past, but the KRG currently lacks political and social cohesion. Tensions have risen between the two ruling Kurdish parties - the KDP and the Patriotic Union of Kurdistan - over wealth, power and energy.” The rivalry has been exacerbated by the toxic competition for the Iraqi presidency, which is traditionally reserved for the Kurds.”
    The KDP has “politically and economically marginalized the PUK in gas development and exportation, which has led to deep grievances within the PUK. Special projects in the controlled area. The KDP’s unilateral actions regarding the energy sector have not prompted the union Not only could the PUK ally with Baghdad and pro-Iranian forces, but it might also disrupt the KRG gas flows to Erbil as in the past.”
    This indicates that "any gas deal led by the KDP and Ankara, without the blessing of the PUK, will face serious political and security issues because most of the gas fields are located in PUK-controlled areas."
    Additionally, “The KRG has significant public trust issues when it comes to energy matters primarily because of how the oil sector has developed in the Kurdish region. The process of contracting, developing and producing oil has suffered from a lack of transparency, and as a result, corruption has become a hallmark of Kurdish oil policy. The fate of billions of dollars is still missing, and the collection of oil revenues is still ambiguous and this has frustrated the Kurdish public, who are skeptical about making financial and economic profits from the region’s energy resources.Therefore, there was great resistance and opposition regarding the development of the gas sector for export purposes. Kurdish energy nationalism designed to excite the Kurdish public by promising a Kurdish state and prosperity is gone. Instead, the Kurdistan Region has fallen into a version of the oil curse trap like many oil-rich countries."
    The report believes that "gas will have the same fate as oil, and its positive impact has been eroded by a lack of transparency, corruption, and mismanagement. Some express additional concern about the possibility that Erbil will move forward without a political agreement with Baghdad."

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    Added 10/18/2022 - 11:12 AM
    Update 10/18/2022 - 12:39 PM
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