Kurdistan is selling oil: From no-one to some-one
Khaled Salih
An unsurprising response came out of Baghdad soon after the news was released. Ali Fayyaz, the deputy head of oil and gas committee (in the federal parliament), asked the Iraqi government to issue a halt and prevention order.
One would also expect an unsurprising reaction from one the political parties in Kurdistan. According to some media reports, a PUK member of the Kurdistan Parliament, Izzet Sabir, was unhappy that Kurdistan’s oil was about to be sold to international buyers now. He argued that it would have been better if this was done a year later.
In many ways, these are natural and understandable reactions to KRG’s gradual and dramatic achievement. Gradual, because reaching this date was envisioned already during the constitutional negotiations in 2005 when Kurdistan’s representatives made very serious efforts to create a constitutional base for economic independence and prevent future governments in Iraq to repeat previous destructive policies in Kurdistan. In the past, oil revenue was used to militarise Iraq, wage wars against Kurdistan’s population, including Anfal (Iraq’s genocide against the Kurds). You can still see many reminders of that policy throughout Kurdistan. In the mountains, all road networks and infrastructure had military purposes: demolition of the countryside, total control of the population under the republic of fear, demoralising the entire population so there will be no future hope. In many areas, natural life was about to extinguish: birds, animals, trees, flowers and water springs were severely effected.
I still remember a call from a friend. A veteran peshmerge, he ended up in a refugee camp in 1989 in Iran. Like hundreds of thousands of people, he run away from the chemical attacks during the Anfal operations. Although he was happy to have survived, crying forced him to repeat himself over a poor telephone line. At last his message became clear: “Kurdistan is finished. The Kurds have become the Jews of the Middle East. They well be gone soon.”
Until mid-1990s, there were no infrastructure projects in Kurdistan. No industry worth to be mentioned. Shortage of fuel products and electricity prevented the region to develop any major project. It was only after the KRG used a couple of gas fields to provide gas to power-plants in 2007, ordinary citizen of the Kurdistan Region started to enjoy life. As a consequence of several initiatives, foreign and local investors started to believed in the future potential of the Region.
One milestone of this gradual process was the passing of Kurdistan’s oil and gas law in August 2007, which created a fertile ground for international oil and gas companies to look seriously at Kurdistan. It was still a slow process. Few small, but not insignificant, private oil companies together with a few middle-size public and one government-owned companies dared to take the risk of joining an uncharted oil region. They were not frightened by the threats of boycott and punishment from Iraqi government. Several Kurdish political leaders were either hesitant or actively against KRG’s novel oil policy. Within a few years, major oil companies changed the game when they acquired oil concessions in Kurdistan, despite the warnings of their own governments and repeated threats from the Iraqi government.
The second milestone came when Kurdistan exported its first oil in mid-2009. That raised the expectation about Kurdistan’s potential. Less than 5 years later, the KRG managed to fast-track the construction of its export pipeline with the help of a private Kurdish company, thus adding another milestone in its gradual development as an oil producing region. Selling the oil from new oilfields is a final stage of transforming Kurdistan from no-one to someone who can deliver from exploration to production to delivery of oil to the international market in record time.
Back in 2005 when Kurdistan’s negotiators were struggling to secure Kurdistan’s future in a new federal, democratic and plural Iraq, there were no data about Kurdistan’s energy potential. Today, a track record is visible. The KRG has demonstrated in the past nine years that when there is a vision and clear determination to change the conditions of a political strait-jacket, positive development is possible despite all the limitation coming from your partners or allies (whether the federal government in Baghdad, opposition groups inside Kurdistan or war-allies like United States or United Kingdom who all opposed what we witness these days).
In the coming years Kurdistan’s export capacity can go from a few hundred thousand barrels to a million. That will change the fate of Kurdistan politically, economically and socially. Many of us will still remember that only a few decades ago Kurdistan’s population was living under constant existential threats, shortage of almost every commodity and living in refugee camps in neighbouring countries and further afield. After a few years of political stability and security, Kurdistan’s name is now added to the map of energy providers. Foreign investors bring labour forces to the Region. People commute to Kurdistan from far distances. Economic actives are visible throughout the Region. Hoping to see a brighter and more prosperous Kurdistan is no longer a dream. Kurdistan is about to get its own personality and identity. In the context of modern Kurdish politics, this is a dramatic change. Selling of Kurdistan’s oil is announced by a neighbouring country’s energy minister. In that announcement meets Kurdistan’s gradual and dramatic transformation.
