What oil gives, oil can take away. Over the past decade, the Kurds of Iraq used petroleum revenues to build the basis of an independent state. But following their independence referendum of September 25, the decisive response of Baghdad has stripped them of the oil-fields vital to their budget.
The open secret of the Kurdish oil boom was that, at least until 2013, it was largely financed by the region’s revenue share from Baghdad. The fine new towers of Erbil were built with money derived from the oil-fields of Basra. When the Kurdistan region’s allocation of the federal budget was cut off following disputes over independent oil exports and sales, it plunged deeply into debt – to local banks, Turkey and oil companies and traders.
The region’s financial position improved when, following the fall of Mosul to ISIS in June 2014, Kurdish forces moved into a vacuum and took control of most of Kirkuk. The giant Kirkuk field, discovered in 1927, is divided into three domes: the southernmost and oldest, Baba Gurgur, the middle, Avana and the northernmost, Khurmala, which has been operated by Kurdish company KAR since 2009. Nearby is another large field, Bai Hassan, and two smaller ones, Jambur and Khabbaz, which are all linked by pipeline to Avana. Baghdad has now regained control of all except Khurmala.
From Baba Gurgur, the main export pipeline runs south-west to the refining town of Baiji and then north to the Turkish port of Ceyhan, but it has been shut down by ISIS attacks since 2014. A separate pipeline was opened by the Kurds in 2013 to take oil from Khurmala and other fields to the Turkish border and connect to the Kirkuk-Ceyhan pipeline.
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Output from the Taq Taq field, once the Kurdish region’s flagship, has collapsed as reserves were found to be greatly overstated, and the geology of several other Kurdish fields has disappointed. This left the Kurdistan Regional Government (KRG) dangerously dependent on Kirkuk for revenues. In the space of a day, that control has evaporated, and there are even suggestions of federal Iraqi forces advancing on Khurmala and other Kurdish areas.
If the Kurds were to lose control of Khurmala, they would not only be deprived of its 110,000 barrels per day (bpd) production, but also the 13,500 bpd from Taq Taq, whose export pipeline connects there. That would leave them with just Tawke, at 110,000 bpd, Taqa’s Atrush field with 22,000 bpd, Shaikan with 38,000 bpd, and a gaggle of small fields. Export revenues of some $300 million monthly will not cover a budget of $700 million, nor repay the traders who took big risks in advancing the KRG funds.
The Kurds’ political mistakes are well-known: they forgot their dispensability after the defeat of ISIS, miscalculated their support in Washington, and underestimated the determination of Baghdad, Tehran and Ankara to prevent their secession. The financial succour provided by Rosneft’s entry to the region and its contribution to $3 billion of oil pre-payments has not yet been backed up by Russian political assistance.
Though all Kurdish parties ultimately supported the referendum, it was widely seen as a mechanism to preserve incumbent president Masoud Barzani and his Kurdistan Democratic Party (KDP); the rival Patriotic Union of Kurdistan (PUK) appears to have struck a deal to allow the Iraqi forces into parts of Kirkuk. The KDP’s control of the oil file, and its consequent revenues and opportunities for corruption, contributed to this disunity, as it had as far back as the 1994-7 civil war, when the KDP and PUK clashed over oil-smuggling routes.
The Kurdish government was seduced by the lure of Kirkuk, and failed to develop its own fields sufficiently. They contrapted a patronage-based, unsustainably costly rentier state. The confidence of oil investors has been undermined by inadequate and late payments of their costs, and long delays in approving new developments. ExxonMobil has withdrawn from most of the blocks it entered with such fanfare in 2011, and the future of Bashiqa, in a disputed area, looks doubtful too. Though Rosneft has announced it has signed for five, unnamed exploration blocks, several of these too are understood to be in debatable territory now likely to be back under Baghdad’s control. And Chevron has ceased drilling due to the post-referendum disruption.
The region’s major gas resources could have saved it money at home which was spent on expensive diesel for power generation, and developed domestic industries, while underpinning exports to Turkey and even federal Iraq. But only in August did it settle a long-running arbitration case with Sharjah-based Dana Gas, allowing it to move ahead with fields that would supply a new pipeline to Turkey. A Turkish pipeline would have given it some more leverage over Ankara as winter approaches.
For now, the Kurds have little choice but to negotiate with Baghdad, playing the few cards that they still hold. The main Kirkuk-Ceyhan pipeline, which Iraqi oil minister Jabbar Al Luaibi wants to reopen, runs through Kurdish territory. Another deal on exports and revenue-sharing is possible, along with cooperation on refining and gas supplies. But if the Kurds want even to regain their autonomy, let alone dream of independence again, they need a sustainable, diversified economy, one that is not dependent on a few oil-wells that can so easily change hands.
Robin M. Mills is CEO of Qamar Energy, and author of The Myth of the Oil Crisis
Company Profile
Name: Direct Debit System
Started: Sept 2017
Based: UAE with a subsidiary in the UK
Industry: FinTech
Funding: Undisclosed
Investors: Elaine Jones
Number of employees: 8
Kill
Director: Nikhil Nagesh Bhat
Starring: Lakshya, Tanya Maniktala, Ashish Vidyarthi, Harsh Chhaya, Raghav Juyal
Rating: 4.5/5
The specs: 2018 Alfa Romeo Stelvio
Price, base: Dh198,300
Engine: 2.0L in-line four-cylinder
Transmission: Eight-speed automatic
Power: 280hp @ 5,250rpm
Torque: 400Nm @ 2,250rpm
Fuel economy, combined: 7L / 100km
Bob Marley: One Love
Director: Reinaldo Marcus Green
Starring: Kingsley Ben-Adir, Lashana Lynch, James Norton
Rating: 2/5
Federer's 19 grand slam titles
Australian Open (5 titles) - 2004 bt Marat Safin; 2006 bt Marcos Baghdatis; 2007 bt Fernando Gonzalez; 2010 bt Andy Murray; 2017 bt Rafael Nadal
French Open (1 title) - 2009 bt Robin Soderling
Wimbledon (8 titles) - 2003 bt Mark Philippoussis; 2004 bt Andy Roddick; 2005 bt Andy Roddick; 2006 bt Rafael Nadal; 2007 bt Rafael Nadal; 2009 bt Andy Roddick; 2012 bt Andy Murray; 2017 bt Marin Cilic
US Open (5 titles) - 2004 bt Lleyton Hewitt; 2005 bt Andre Agassi; 2006 bt Andy Roddick; 2007 bt Novak Djokovic; 2008 bt Andy Murray
T20 World Cup Qualifier
October 18 – November 2
Opening fixtures
Friday, October 18
ICC Academy: 10am, Scotland v Singapore, 2.10pm, Netherlands v Kenya
Zayed Cricket Stadium: 2.10pm, Hong Kong v Ireland, 7.30pm, Oman v UAE
UAE squad
Ahmed Raza (captain), Rohan Mustafa, Ashfaq Ahmed, Rameez Shahzad, Darius D’Silva, Mohammed Usman, Mohammed Boota, Zawar Farid, Ghulam Shabber, Junaid Siddique, Sultan Ahmed, Imran Haider, Waheed Ahmed, Chirag Suri, Zahoor Khan
Players out: Mohammed Naveed, Shaiman Anwar, Qadeer Ahmed
Players in: Junaid Siddique, Darius D’Silva, Waheed Ahmed
The view from The National
The Iron Claw
Director: Sean Durkin
Starring: Zac Efron, Jeremy Allen White, Harris Dickinson, Maura Tierney, Holt McCallany, Lily James
Rating: 4/5
Company Profile
Founder: Omar Onsi
Launched: 2018
Employees: 35
Financing stage: Seed round ($12 million)
Investors: B&Y, Phoenician Funds, M1 Group, Shorooq Partners
How to register as a donor
1) Organ donors can register on the Hayat app, run by the Ministry of Health and Prevention
2) There are about 11,000 patients in the country in need of organ transplants
3) People must be over 21. Emiratis and residents can register.
4) The campaign uses the hashtag #donate_hope
MATCH INFO
Day 1 at Mount Maunganui
England 241-4
Denly 74, Stokes 67 not out, De Grandhomme 2-28
New Zealand
Yet to bat
COMPANY PROFILE
Company: Sideup
Started: 2019
Founder: Waleed Rashed
Based: Cairo, Egypt
Industry: technology, e-commerce
Funds raised so far: $1.2 million
Investors: Launch Africa VC, 500 Global, Riyadh Angels, Alex Angels, Al Tuwaijri Fund and Saudi angel investor Faisal Al Abdulsalam
Company Profile
Company name: Cargoz
Date started: January 2022
Founders: Premlal Pullisserry and Lijo Antony
Based: Dubai
Number of staff: 30
Investment stage: Seed
SPECS
Engine: 1.5-litre turbo
Power: 181hp
Torque: 230Nm
Transmission: 6-speed automatic
Starting price: Dh79,000
On sale: Now
More from Neighbourhood Watch
US PGA Championship in numbers
1 Joost Luiten produced a memorable hole in one at the par-three fourth in the first round.
2 To date, the only two players to win the PGA Championship after winning the week before are Rory McIlroy (2014 WGC-Bridgestone Invitational) and Tiger Woods (2007, WGC-Bridgestone Invitational). Hideki Matsuyama or Chris Stroud could have made it three.
3 Number of seasons without a major for McIlroy, who finished in a tie for 22nd.
4 Louis Oosthuizen has now finished second in all four of the game's major championships.
5 In the fifth hole of the final round, McIlroy holed his longest putt of the week - from 16ft 8in - for birdie.
6 For the sixth successive year, play was disrupted by bad weather with a delay of one hour and 43 minutes on Friday.
7 Seven under par (64) was the best round of the week, shot by Matsuyama and Francesco Molinari on Day 2.
8 Number of shots taken by Jason Day on the 18th hole in round three after a risky recovery shot backfired.
9 Jon Rahm's age in months the last time Phil Mickelson missed the cut in the US PGA, in 1995.
10 Jimmy Walker's opening round as defending champion was a 10-over-par 81.
11 The par-four 11th coincidentally ranked as the 11th hardest hole overall with a scoring average of 4.192.
12 Paul Casey was a combined 12 under par for his first round in this year's majors.
13 The average world ranking of the last 13 PGA winners before this week was 25. Kevin Kisner began the week ranked 25th.
14 The world ranking of Justin Thomas before his victory.
15 Of the top 15 players after 54 holes, only Oosthuizen had previously won a major.
16 The par-four 16th marks the start of Quail Hollow's so-called "Green Mile" of finishing holes, some of the toughest in golf.
17 The first round scoring average of the last 17 major champions was 67.2. Kisner and Thorbjorn Olesen shot 67 on day one at Quail Hollow.
18 For the first time in 18 majors, the eventual winner was over par after round one (Thomas shot 73).
RESULTS
9pm: Maiden (PA) Dh70,000 (Dirt) 2,000m
Winner: Mubhir Al Ain, Antonio Fresu (jockey), Ahmed Al Mehairbi (trainer)
9.30pm: Handicap (TB) Dh70,000 (D) 2,000m
Winner: Exciting Days, Oscar Chavez, Doug Watson
10pm: Al Ain Cup – Prestige (PA) Dh100,000 (D) 2,000m
Winner: Suny Du Loup, Marcelino Rodrigues, Hamad Al Marar
10.30pm: Maiden (PA) Dh70,000 (D) 1,800m
Winner: Jafar Des Arnets, Oscar Chavez, Ahmed Al Mehairbi
11pm: Wathba Stallions Cup – Handicap (PA) Dh70,000 (D) 1,600m
Winner: Taj Al Izz, Richard Mullen, Ibrahim Al Hadhrami
11.30pm: Maiden (PA) Dh70,000 (D) 1,400m
Winner: Majdy, Antonio Fresu, Jean de Roualle
12am: Maiden (PA) Dh70,000 (D) 1,400m
Winner: Hamloola, Sam Hitchcott, Salem Al Ketbi
The specs
Engine: 4.0-litre twin-turbo V8
Power: 680hp at 6,000rpm
Torque: 800Nm at 2,750-6,000rpm
Transmission: Rear-mounted eight-speed auto
Fuel consumption: 13.6L/100km
On sale: Orderbook open; deliveries start end of year
Price: From Dh970,000
COMPANY PROFILE
Company: Eco Way
Started: December 2023
Founder: Ivan Kroshnyi
Based: Dubai, UAE
Industry: Electric vehicles
Investors: Bootstrapped with undisclosed funding. Looking to raise funds from outside
THE SPECS
Aston Martin Rapide AMR
Engine: 6.0-litre V12
Transmission: Touchtronic III eight-speed automatic
Power: 595bhp
Torque: 630Nm
Price: Dh999,563
Sarfira
Director: Sudha Kongara Prasad
Starring: Akshay Kumar, Radhika Madan, Paresh Rawal
Rating: 2/5
Quick pearls of wisdom
Focus on gratitude: And do so deeply, he says. “Think of one to three things a day that you’re grateful for. It needs to be specific, too, don’t just say ‘air.’ Really think about it. If you’re grateful for, say, what your parents have done for you, that will motivate you to do more for the world.”
Know how to fight: Shetty married his wife, Radhi, three years ago (he met her in a meditation class before he went off and became a monk). He says they’ve had to learn to respect each other’s “fighting styles” – he’s a talk it-out-immediately person, while she needs space to think. “When you’re having an argument, remember, it’s not you against each other. It’s both of you against the problem. When you win, they lose. If you’re on a team you have to win together.”