Iraq's deal with BP to boost oil production, strengthen Kirkuk's energy sector

Shafaq News/ Iraq's recent agreement with British oil giant BP to redevelop Kirkuk’s key oil and gas fields is a significant step for the region’s economic growth, Jaafar Abbas Karim, the administrative and financial deputy of Kirkuk's governor said on Saturday.

Speaking to Shafaq News, Karim emphasized that the deal would help enhance the operations of North Oil Company, increasing its oil production capacity.

“The agreement is expected to increase output and utilize associated gas, which would contribute to electricity generation in Kirkuk through new power stations,” he explained, pointing out that the deal aligns with Kirkuk’s urgent need to revitalize its oil and gas sectors and would improve key services such as electricity.

“The provincial authorities are awaiting BP's start on implementing the contract in the near future.” He said.

Last January, Iraq reached an agreement with BP to redevelop four major oil and gas fields in Kirkuk. The deal aims to increase oil production by up to 150,000 barrels per day (bpd.)

The deal also includes investments to eliminate the practice of gas flaring by 2028.

According to Iraq’s Oil Minister Hayan Abdel-Ghani, “This deal will benefit the region by supplying underutilized northern refineries with more crude oil.”

Unlike older agreements with foreign companies that offered limited financial benefits, the new agreements are designed to be more profitable and attractive to international investors.

This deal, while hailed as a potential economic boon for Iraq, is likely to have implications, particularly as the government moves forward with plans to secure control over three major fields in Kirkuk—Khurmala, Havana, and Kormor—which are currently under Kurdish control. The Kurdistan Regional Government (KRG) has expressed concerns about the project, stressing the need for coordination with Baghdad.

Masrour Barzani, Prime Minister of the Kurdish region, highlighted the constitutional dispute over Kirkuk’s status and called for trilateral discussions between Baghdad, the Kurdish region, and BP to ensure the agreement’s implementation is fair and inclusive.