The Kurdistan-Iraq Oil and Gas Conference in Erbil heard confirmation that the Kurdistan Regional Government has signed an oil exploration contract with ExxonMobil, the world’s largest oil company.

Ashti Hawrami, the minister for natural resources, told the conference that the KRG had signed a contract with ExxonMobil and that the federal government was kept informed throughout the negotiations.

He said, “This will make a dynamic change in the region and will lead to mergers and acquisitions.” He said that Kurdistan had initially signed contracts with “small and beautiful” companies and was now working with “the giant and magnificent”.

In answer to questions from the audience, Dr Hawrami said the ExxonMobil contract was signed on October 18 and involves six exploration areas. “This agreement is good news not just for us but for all Iraq. This is also good news for the industry. It adds more value in terms of expertise and investment,” he said.

Dr Hawrami was speaking at the two-day conference which attracted hundreds of industry executives from around the world, including representatives from major oil companies not currently working in the region.

The conference was opened by Prime Minister Barham Salih on Sunday and was attended by Kamal Kirkuki, the Speaker of the Kurdistan Parliament, Selahattin Cimen, Turkey’s deputy energy minister, and Britain’s ambassador to Iraq Michael Aron.

“Not long ago holding such a conference in Kurdistan was beyond a dream,” said Dr Salih in his opening speech. He set out the economic deprivation and genocide in Kurdistan over several decades, in contrast with today’s economic boom.

“The economy today is moving on and moving forward.” He said Kurdistan has a major stake in a successful and strong Iraq and that Kurdistan is exercising its constitutional right to develop its resources. “I dare dream that from the devastation and destruction of the genocide we can have a future that’s democratic and prosperous.”

The prime minister said the KRG and the federal government had agreed that the 2007 draft hydrocarbons law would be used as the basis for discussions on a federal law. He added that it was agreed a draft would be presented to the parliament by the year’s end.

Kurdistan’s oil and gas sector has taken off in the past few years from a standing start, which has put Kurdistan on the global energy map. The KRG has signed 45 contracts with companies from 17 countries. In 2012, Kurdistan will export 175,000 barrels of oil a day. It will provide electricity to neighbouring provinces in the near future thanks to several gas-powered energy plants.

Dr Hawrami told the conference that the KRG would continue publishing its contracts for the sake of transparency and said he hoped this would become a model for the region.

Dr Hawrami also spoke about pipelines, gas and the important role of Turkey as an energy transportation route to Europe with the possibility of Kurdistan joining the Nabucco pipeline or using an LNG terminal in Ceyhan in Turkey to export gas to Europe. He said the KRG has a target of 1million barrels a day of oil exports via the Kirkuk-Ceyhan pipeline and to increase Kurdistan’s oil refining capacity to 300,000 barrels a day.

The conference also heard from Dr Cimen who spoke about Turkey’s position in the energy world. Turkey’s Genel Enerji was among the first oil companies to enter Kurdistan and is now merging with Vallares, former BP chief executive Tony Hayward’s company.

British MP Nadhim Zahawi delivered a message of congratulations to the conference from Britain’s energy minister Charles Hendry.

The conference heard discussions on oil and gas services, finance, pipeline and infrastructure plans, the need to hire local labour, projects to support local communities, and plans to export electricity.

© KRG