Iraq is looking to revive the northern Kirkuk oil field after striking a deal with BP.
The oil major, which already operates Iraq’s largest oilfield at Rumaila, will allow BP to negotiate access to reserves in the north of the country, in exchange for ending the decline in output from Kirkuk.
But the deal faces opposition from the Kurdistan Regional Government, which previously rejected plans to regenerate the field by BP and the Iraqi government as illegal.
“The KRG’s position on this issue remains unchanged,” a spokesman for the KRG’s Ministry of Natural Resources.
“No company will be permitted to work in any part of the disputed territories including Kirkuk without formal approval and involvement of the KRG.”
The letter of intent, signed at the beginning of September, will see BP work on the Iraqi side of the border with Kurdistan, and is thought to run for around 18 months initially.
Kirkuk’s output has fallen to around 280,000 barrels per day, from a peak of around 1million boed a decade ago. Poor management practices during Saddam Hussein’s time as president are believed to have damaged the field.
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