Genel irked over Kurdish PSCs
UK energy company Genel said August 20 it would contest a decision by the semi-autonomous Kurdish government in Iraq to terminate contracts at two oil and natural gas fields.
Genel Energy said it received notice from the Kurdish Ministry of Natural Resources of its intent to terminate production sharing contracts (PSCs) at the Bina Bawi and Miran oil and gas fields in northern Iraq.
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Believing the Kurdish regional government (KRG) had no grounds to issue such a notice, Genel said it was contesting the decision.
“Genel had earlier reached a commercial understanding with the KRG in September 2019 to develop the fields using a staged and integrated oil and gas development concept,” the company said. “In the course of those negotiations leading to updated terms of the parties’ agreements, the KRG confirmed to Genel that it would not serve notice of intention to terminate the PSCs while these negotiations remain ongoing.”
Genel currently only produces oil, but it is looking to develop gas resources at its 100%-owned Miran and Bina Bawi gas fields in the Kurdish north. The company said last year it received documentation from the KRG that included a draft PSC for Bina Bawi.
Genel in its report for the first half of the year expressed frustration with the lack of development from the Kurdish government, saying the regional assets represented significant value both for the company and for the KRG. It said at the time that it “proved difficult” to engage with the Kurdish government over getting the necessary permits to move toward development.
Genel estimates Bina Bawi reserves at 8.2 trillion ft3 of natural gas and 37mn barrels of oil.