An agreement between the central government in Baghdad and a Kurdish party, which had recently disrupted oil flow from the northern Iraqi region of Kirkuk to Turkey, has enabled the resumption of the process.
Kosrat Rasul, head of the Patriotic Union of Kurdistan (PUK) that controls Kirkuk’s oil fields, said his group has reached a deal with Prime Minister Haider al-Abadi on Tuesday, Reuters reported.
Under the agreement, crude will continue flowing from the region through a pipeline to a Turkish export terminal on the Mediterranean en route to global markets.
Last week, PUK forces stormed the state-run North Oil Company (NOC) in Kirkuk, which resulted in briefly stopping oil exports in an effort to force Baghdad to meet its demand for a share of the revenue.
Aala Talabani, a key PUK lawmaker in the Iraqi parliament, said local authorities were unhappy that neither Baghdad nor the semi-autonomous Kurdistan Regional Government (KRG) was prepared to build a local refinery “so that the people of the province can have a share of the petrodollars.”
The Kurdish group also called for the 2016 Kirkuk oil sharing deal between Baghdad and the Kurdistan region “to be canceled within a week.”
However, Rasul said that Tuesday’s “agreement ended the problem and there is no deadline anymore” to shut the pipeline, without providing further details.
The huge Kirkuk oil field can pump around 150,000 barrels per day and has been exporting the output to global markets via Turkey.
Also on Wednesday, Iraqi Oil Minister Jabar al-Luaibi said the country had added a processing unit to the Kirkuk oil refinery, increasing the plant’s capacity by 10,000 barrels per day.
In 2014, the KRG, led by President Massoud Barzani, began independent crude exports from Kirkuk, a move that sparked tensions with the central government.
However, Baghdad and Erbil inked a deal last year on the issue and agreed to equally split the revenues.
The PUK, a historic adversary of Barzani’s Erbil-based ruling Kurdistan Democratic Party, has long been against the agreement.