Norway's DNO has no immediate plans to ship oil through the Iraq-Turkey pipeline that is about to restart after a two-year suspension, the company said on Friday, and will continue to sell directly to Iraq's semi-autonomous region of Kurdistan.
Two Iraqi oil ministry officials told Reuters on Thursday the link from Iraq's Kurdistan region to Turkey will resume operations on Saturday following a tripartite agreement between the federal government, the Kurdistan Regional Government and eight oil companies.
DNO, the largest international oil producer in the KRG, did not sign the deal because it wanted more clarity on how outstanding debts would be paid. DNO shares fell 1.9 per cent shortly after the opening on the Oslo stock exchange.
"DNO is pleased that exports of oil from the Kurdistan Region have been unlocked and will now flow to international markets," Executive Chairman Bijan Mossavar-Rahmani said in a statement.
"We have elected not to engage directly in exports at this time and will continue to sell our oil on a monthly, cash-and-carry, basis to our buyers at a per barrel price in the low USD 30s," he added.
DNO operates the Tawke licence that includes the Tawke and Peshkabir fields. It has a 75 per cent stake in the licence and its partner Genel Energy has the remaining 25 per cent.
DNO and Genel will be left with about 30,000 barrels of oil per day after delivering some 38,000 bpd to the Kurdistan Regional Government for exports, DNO said.
Although DNO has not signed the tripartite agreement, its buyers could still ship its oil through the export pipeline.
"We understand our buyers have set up their own arrangements to place oil purchased from us into the export pipeline, a move we welcome as it supports the larger export project," Mossavar-Rahmani added.
(Reporting by Nerijus Adomaitis; editing by Barbara Lewis)
