Hit by a huge political risk premium on the value of its crude oil exports, Iraq’s Kurdistan Regional Government (KRG) has been seeking to change the pricing formula for calculating IOC payments. Faced with resistance from a number of IOCs, the KRG has now opted to unilaterally make payments in line with its preferred formula.
IOCs were already threatening to curb investments in Iraqi Kurdistan due to delayed payments (MEES, 3 February), and this move may make firms even more averse to new investment in the region. (CONTINUED - 1221 WORDS)
