Dana Gas, Crescent: Iraq gas supply within contract rights

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Dana Gas and Crescent Petroleum, joint operators on behalf of the Pearl Petroleum consortium, expressed surprise at KRG yesterday’s statement on supplying gas to the Iraqi Ministry of Electricity. 

The GSA was entered into in strict compliance with Pearl’s exclusive marketing rights, which have been previously upheld in multiple international legal proceedings and did not require any additional authorization or approval from the KRG.

The KRG has known about the Gas Sales Agreement (GSA) with the MoE since January of this year and was provided with a copy. 

This follows years of discussions and efforts by the company, of which the KRG was regularly updated, and the KRG Ministry of Natural Resources was aware of the preparations for gas supply. Pearl therefore rejects any allegation of breach of its contractual obligations, which it has always respected. The company continues to meet in full its gas supply obligations to the KRG, notwithstanding the KRG’s breach of its own contractual payment obligations, for which it has been materially in arrears for over 3 years.

As was previously announced, the 100 mmscf/d of gas supplies to the MoE in Kirkuk is from the company’s excess capacity at Khor Mor made possible by the KM250 project and is in addition to the 655 mmscf/d of gas currently provided to the KRG for use in power stations which meets the KRI’s actual needs and has also been enabling electricity sales from the KRI to the MoE for almost a decade already.

Pearl has invested more than $4 billion since 2007 as the largest investor in this sector.