The New York Times published an article on the latest efforts by the Kurdish Regional Government to go their own way from central Iraqi control on oil production and sales, in light of continued failure to negotiate new terms for revenue sharing.
The current arrangement is an 83/17 revenue split, with the national government in Baghdad on the high side, which hardly seems reasonable. I think it’s somehow derived from 17% of the reserves being in Kurdistan, but even that doesn’t make much sense (especially when so much of the past couple years’ rise in Iraqi production and new development contracts have been on Kurdish land and via the regional government). And the article suggests that the resistance by Baghdad to changing the arrangement is fueling a rapidly accelerating cycle of mutual non-cooperation that will probably end in an independence attempt:
The more Kurdish officials developed their oil industry, the more Baghdad balked. The more the central government restricted the Kurds, the more they felt like they had no choice but to press forward.
“Their policy is actually backfiring,” said Howri Mansurbeg, a professor of petroleum geosciences at Soran University in Kurdistan, said of Iraqi officials. “They want to prevent a Kurdish state, and now the exact opposite is happening.”
Maybe there would be a case for such an unbalanced ratio if Baghdad provided tons of services and defense to the Kurdistan Region, but they’ve done jack for them … and then have demanded everything from them, after the national security forces literally threw their weapons on the ground and ran away.
At the point Maliki handed Kirkuk to the Kurdish Regional Government to take care of, and their forces held it successfully, I think they earned the right to a lot more revenue. (And — as the Times points out, matching my analysis at the time in June — at the point he handed them Kirkuk, he also handed them enough oilfields to become independent.)
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