Iraq to pay Kurdish region salaries in return for oil revenues

For the past two months, Iraq's Finance Ministry has stopped paying the salaries of Kurdish administration staff after accusing administration officials of failing to honor a September agreement stipulating that export revenue from 400,000 bpd of oil be channeled into the federal state budget.

Iraq to pay Kurdish region salaries in return for oil revenues

World Bulletin / News Desk

Iraq Prime Minister Nouri al-Maliki said on Friday that Baghdad would pay the February salaries of Kurdish administration officials in northern Iraq in return for diverting revenue from 400,000 barrels per day (bpd) of oil into the state budget.

The central government "agrees to pay the salaries of the staff of the Kurdistan administration for the month of February in return for oil revenue from the Kurdistan region going into the federal budget," according to a statement issued by al-Maliki's office.

For the past two months, Iraq's Finance Ministry has stopped paying the salaries of Kurdish administration staff after accusing administration officials of failing to honor a September agreement stipulating that export revenue from 400,000 bpd of oil be channeled into the federal state budget.

Relations between Baghdad and the Kurdish administration have been strained since early 2013, when Iraq's parliament passed a budget for the Kurdish region over the objections of Kurdish officials.

Tension between Baghdad and Irbil has mounted further recently over the latter's right to export oil independently of the central government.

The Kurdish administration says it has a constitutional right to sign export deals without Baghdad's prior approval. Baghdad, for its part, refuses to acknowledge agreements signed between Irbil and foreign oil firms.

Iraq, which holds the world's fourth largest oil reserves, had previously announced plans to increase its daily production to eight million bpd by the end of 2017.

Current daily oil output from the Kurdistan region alone stands at between 350,000 and 400,000 barrels per day, according to the latest reports.

Last Mod: 01 Mart 2014, 09:28
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