Shafaq News

Iraq’s northern oil sector has entered a phase of relative stability after years of security and administrative disruptions. A source at the North Oil Company confirmed to Shafaq News that production from Kirkuk’s main fields has reached about 320,000 barrels per day (bpd), showing that technical and administrative operations have steadied and the company has regained much of its operational capacity.

BP Drives Revival

Production in Kirkuk province is gradually recovering, driven by the Bai Hassan, Jambur, Havana, and Khabbaz fields — the backbone of the region’s energy supply. Daily pumping operations are running smoothly, placing output at roughly 71% of its pre-2023 level.

However, over the past two decades, political disputes, aging infrastructure, and security challenges have repeatedly disrupted operations. The current rebound, supported by technical upgrades and strategic partnerships, suggests a potential return toward these historical production levels.

“British energy firm British Petroleum (BP) continues to provide technical and advisory support to northern fields, aiming to raise output by roughly 150,000 bpd,” the source noted, pointing out that BP has completed a key phase of field studies and reservoir evaluations at Bai Hassan, Jambur, and Havana.

BP is also collaborating with Iraqi technical teams to modernize production systems, implement advanced artificial lift technologies, and improve well efficiency.

The source emphasized that even modest improvements could yield tens of thousands of additional barrels daily, noting that artificial lift and advanced control mechanisms can enhance extraction efficiency, reduce downtime, and extend the life of mature wells.

Export Route Unlocked

With production stabilizing, focus is shifting to exports, which depend on the Iraq–Turkiye pipeline and the coordination between Baghdad and Erbil.

“The North Oil Company has completed all technical preparations to resume crude exports through the Kirkuk–Ceyhan pipeline,” the source confirmed, highlighting that three recent tests verified the pipeline’s integrity and the efficiency of pumping through northern pressure stations. The company is awaiting government approval to resume exports as Baghdad and Erbil finalize a unified shipment arrangement.

The development follows a positive turn in relations: Iraq and the Kurdistan Region recently resolved their oil dispute, enabling the Region to export around 190,000 bpd through Turkiye’s Ceyhan pipeline. The resolution ended a two-year halt caused by legal disagreements over oil ownership and revenue sharing.

Read more: Resumption of oil exports from Kurdistan: Fragile stability with strategic implications

Recent tests also demonstrated that the pipeline can handle over 500,000 bpd without technical issues. Since its completion in 1970, the crude line has served as Iraq’s main northern export route, with a design capacity of about 1.4 million bpd.

Before the 2023 suspension, it transported roughly 450,000 bpd, combining crude from Kirkuk and the Kurdistan Region. Today’s output of 320,000 bpd — around 23% of full design capacity — is regarded not only as an operational recovery but also as an untapped potential that could be realized through further political alignment, particularly with Turkiye or within broader Middle Eastern energy diplomacy.

Read more: Iraq–Turkiye pipeline restart reshapes energy balance

Rising Production, Enduring Bottlenecks

The economic significance of Kirkuk’s output is closely linked to its export capacity. Oil remains Iraq’s backbone, generating roughly 85% of government revenues and around 40% of GDP, according to 2024 World Bank and International Monetary Fund (IMF) assessments. Meanwhile, Kirkuk’s production accounts for nearly 10% of the country’s total crude exports, representing an estimated $9 billion in annual revenue at the 2024 average price of $78 per barrel.

Despite the recent progress, technical and administrative challenges persist. Differences in measurement and control systems, along with unresolved revenue-sharing arrangements, continue to complicate full integration between Kirkuk and Kurdistan Region exports.

The pipeline network also requires continuous maintenance, and any disruption could halt exports.

“The challenge extends beyond pumping oil to ensuring international-grade logistics and compliance with Iraqi and global regulations,” the source emphasized, stressing that transparent contracts, routine oversight, and predictable payment systems are essential to maintain investor confidence and prevent renewed tension in the northern energy sector.

Energy expert Ali al-Bayati highlighted to Shafaq News that the northern fields have a potential capacity exceeding 600,000 bpd, although insufficient investment in pipelines, processing, and pumping facilities has left much of that potential untapped.

“Ongoing cooperation with BP marks a significant shift in field development,” al-Bayati added, noting that raising output to 470,000 bpd would strengthen Iraq’s position in regional oil markets and boost state revenues.

Written and edited by Shafaq News staff.