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Iraqi Kurds Reach Settlement With Dana Gas’s Pearl Venture

A worker walks between pipes at the oil and gas separation facility at the Baba Gurgur oil field in the Arafa district of Kirkuk, northern Iraq, Thursday, May 13, 2004. OPEC's plan to boost oil output may lower prices from near record highs, as long as members ensure rigs, pipelines and refineries are secure, said analysts and traders including Clay Smith of Commerzbank Securities. Photographer: Staton R. Winter/Bloomberg News
A worker walks between pipes at the oil and gas separation facility at the Baba Gurgur oil field in the Arafa district of Kirkuk, northern Iraq, Thursday, May 13, 2004. OPEC’s plan to boost oil output may lower prices from near record highs, as long as members ensure rigs, pipelines and refineries are secure, said analysts and traders including Clay Smith of Commerzbank Securities. Photographer: Staton R. Winter/Bloomberg News
  • KRG to pay Pearl $600 million, plus $400 million investment
  • KRG to pay Pearl $600 million, plus $400 million investment
  • Pearl agrees to boost gas output at Khor Mor by 160 percent

Iraq’s semi-autonomous Kurdish region reached a financial settlement with Dana Gas PJSC and its partners over delays at a natural gas project.

The Kurdistan Regional Government said it will immediately pay United Arab Emirates-based Dana and its partners in the Pearl Petroleum consortium $600 million, plus a further $400 million to invest in development of fields in the region, according to a statement on the KRG’s website. Pearl Petroleum agreed to boost gas output at the Khor Mor field by 160 percent starting in about two years.

A further $1.2 billion will be reclassified from a debt owed by the KRG to Pearl to become an outstanding cost recoverable by the venture from revenues generated from Khor Mor and the Chemchemal field.

The settlement ends an arbitration process which had lasted for almost four years. The KRG originally signed a deal with Pearl to develop the fields in 2007, before a dispute arose between them. The consortium had filed a claim with a U.S. court seeking damages of as much as $26.5 billion.

Pearl Petroleum’s biggest shareholders are Dana Gas and Crescent Petroleum, both based in the Gulf emirate of Sharjah, part of the U.A.E. Austria’s OMV AG, Hungarian energy group Mol Nyrt and Germany’s RWE AG also have shares, according to the venture’s website.

Source: Bloomberg, August 30, 2017

By Grant Smith

https://www.bloomberg.com/news/articles/2017-08-30/iraqi-kurds-reach-settlement-with-dana-gas-s-pearl-venture

 

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