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Baghdad, Erbil Reach Deal on Oil Exports, Payments

Baghdad, Erbil Reach Deal  on Oil Exports, PaymentsBaghdad, Erbil Reach Deal  on Oil Exports, Payments

The government of Iraq and the semi-autonomous region of Kurdistan have reached a deal to ease tensions over Kurdish oil exports and civil service payments from Baghdad, Iraq's finance minister said.

Hoshiyar Zebari said the central government had agreed for the time being to resume payments from the federal budget for Kurdish civil servants' salaries, tradearabia reported.

Zebari described the step as a "major breakthrough" that would reduce friction between the KRG and Baghdad. He said the payments would cover October and then November. The deal was reached after talks between Iraqi Oil Minister Adel Abdel Mehdi and Kurdish Prime Minister Nechirvan Barzani in the Kurdistan region on Thursday.

Baghdad stopped paying for KRG civil servant salaries in protest against the Kurds' exporting oil to Turkey independently.

Under the agreement, Iraqi Kurdistan will give 150,000 barrels per day of oil exports - equal to around half its overall shipments - to the federal budget. In Arbil, the Kurdistan Regional Government (KRG) confirmed the agreement.

"What they have agreed is that Baghdad will release some funds - $500 million - and the KRG will give 150,000 barrels per day of oil to Baghdad," KRG spokesman Safeen Dizayee told Reuters.

He said a KRG delegation headed by the prime minister would travel to Baghdad soon to hammer out a more comprehensive deal and the regional government would not hand over control of exports to Baghdad.

 

Financialtribune.com