Northern Iraq halts oil exports to Jordan amid unrenewed contract

Shafaq News/ Oil exports from northern Iraq's fields to Jordan have ceased for several months, according to a source from the North Oil Company.

The suspension affects fields in Kirkuk, Nineveh, and Saladin, and the stoppage is tied to an unrenewed agreement between Baghdad and Amman.

The source told Shafaq News Agency, "Exports from Kirkuk and Qayyarah fields, managed by the North Oil Company, have been halted for several months. The company is not directly involved in the matter of exports to Jordan, as this is handled by the Ministry of Oil. Our company can increase output to 15,000 barrels per day."

The source emphasized that the North Oil Company is an executive body that follows directives from the federal Ministry of Oil. "If instructed to resume or increase exports, the company is ready to comply," they added.

Economic expert Ali Khalil from Kirkuk also spoke to Shafaq News Agency, noting that the Iraq-Jordan oil agreement has been inactive for about three months due to the lack of contract renewal.

Khalil referenced a recent statement by Jordanian Energy Minister Saleh Al-Kharabsheh, who announced a new agreement with Iraq to increase oil volumes at a competitive price, $16 below the global oil market price.

Khalil stated, "The North Oil Company can export up to 15,000 barrels per day and even can double this quantity from the Kirkuk and Qayyarah fields."

He provided further details, "In April 2024, Iraq exported 100,921,250 barrels of oil, including over a million barrels from Qayyarah and 448,606 barrels from Kirkuk." Over the first four months of the year, Iraq exported nearly 3.98 million barrels from the Qayyarah field in Nineveh and about 1.38 million barrels from Kirkuk.

Production at the Qayyarah field recently increased to 33,000 barrels per day, with 3,000 barrels processed locally and 30,000 barrels set for export. The field, with an estimated reserve of around a billion barrels, is one of Nineveh's largest, alongside other significant fields like Ain Zala, Najma, Batma, and Safiya.

The Qayyarah oil field, which houses 50 wells, suffered significant damage from ISIS militants. Of these, 34 wells were damaged, and 18 were blown up by the militants during their retreat from Qayyarah in August 2016.

Iraq resumed production at the Qayyarah oil field in 2018 after ousting ISIS and undertaking extensive reconstruction efforts. The Ministry of Oil repaired the wells, facilities, and pipelines, and the field began exporting crude oil internationally for the first time. Production paused again in March 2020 but resumed in May 2023, with oil from the field reaching global markets.

Jordan purchases Iraqi crude (Kirkuk crude oil) at Brent prices minus $16 per barrel to account for quality differences and transport costs. This arrangement is intended to meet about 7% of Jordan's crude oil needs.