Excavators have struck three oil fields with reserves estimated at about 2 billion barrels, Kurdish region’s Oil Minister Ashti Horami said.
The discovery is a signal that the region, currently including three provinces, is rich in oil reserves. The find is tempting for foreign oil firms which are vying to win deals to develop oil fields in the region.
The Kurds have signed several production-sharing agreements with companies including Norwegian DNO ASA and Turkey’s PetOil and Gnel Enerji. They have also singed a memorandum of understanding with Australia’s Woodside Petroleum and Heritage Oil and the U.K.’s Sterling Energy.
But the deals are still in question due to resistance from the Oil Ministry in Baghdad which considers them illegal.
But Horami defended the deals, claiming that the Kurdish regional government would reap 90 percent of revenues while other governments only obtained 20-40.
The Kurds have divided their region into small exploration blocks in order to lure medium-size oil firms. “Some majors wanted to have the whole region as one block or at least be divided into two,” Horami said.
He said splitting the Kurdish region into smaller blocks gave the authorities the chance to deal with many companies and strike deals with “much higher profit margins.”
The latest find is the largest in the region so far. But the Kurds say it is of a “very small scale” in comparison to the massive recoverable reserves of the oil-rich region of Kirkuk.
The Province of Kirkuk, which the Kurds want to annex, is one of the richest in Iraq holding reserves estimated at more than 40 billion barrels.
But there is much opposition in Iraq from across the political spectrum for the Kurdish ambition to have Kirkuk as part of their self-rule areas.
Oil companies are attracted to Kurdistan because of its relative safety compared with the rest of Iraq where it is virtually impossible for foreign oil companies to work.
Horami also said his ministry would construct two new refineries with a combined capacity of 100,000 barrels a day. He declined to say which company would build the refinery and which one made the new discovery.
He said the region has so far signed 20 oil development deals with firms from the U.S., Australia, Canada, South Korea, India and Turkey.

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