ERBIL, Kurdistan Region – With oil production up and anticipating a resumption in the flow of Kirkuk’s oil, the KRG has increased capacity in its pipeline to Turkey.

The Kurdistan Regional Government (KRG) recently installed another pumping station at Sheikhan, boosting capacity in the export pipeline from 900,000 to one million barrels per day (bpd), the Ministry of Natural Resources (MNR) announced on Sunday.

“This extra capacity will accommodate future production growth from KRG producing fields, and can also be used by the federal government to export the currently stranded oil in Kirkuk and surrounding areas,” MNR stated.

Baghdad was reportedly working on a deal with Erbil to pump Kirkuk oil into the KRG’s pipeline for sale through Turkey’s Ceyhan port.

The federal government has been unable to export much of Kirkuk’s oil since taking control of the province’s fields last autumn. It was trucking fewer than 30,000 bpd to Iran, but is reported to be halting that ahead of US sanctions that will come into force on Monday. Iraq may, however, benefit from one of eight waivers Washington has granted to select countries.

The KRG has also boosted its own output. After losing control of Kirkuk’s oil fields in mid-October, the Kurdistan Region’s oil exports were slashed by about half, to under 300,000 bpd.

“The KRG currently exports over 400,000 bpd of crude oil,” MNR announced on Sunday.

Some of the boost has come from the Tawke license.

DNO and Genel Energy reported over 50,000 bpd production from the Peshkhabir oil field on November 1, “beating its end-2018 target ahead of schedule and below budget,” Genel stated.

MNR said this boost has “more than compensated for the natural decline of the main Tawke field area,” noting that overall production at Tawke is averaging 130,000 bpd.

The government also said that regular payments to multi-national companies have improved the sector.

“The KRG’s policy of maintaining consistent and timely payments to its producing oil companies has led to more investment in its oil fields, stabilising production levels and paving the way for further production increases during 2019,” MNR stated.

It looked forward to oil sales contributing to Kurdistan Region’s economic recovery.

Financially dependent on oil, the KRG has prioritized payments to oil producing companies after being brought to an international arbitration court by Pearl Petroleum.

Rudaw