The first batch of Kurdistan Regional Government (KRG) gas is planned to flow into Turkey in the next two or three years, and 20 billion cubic meters of it is expected to pour into the Turkish market in early 2020, according to Tony Hayward, the chairman of Genel Energy, one of the leading energy companies in Iraqi Kurdistan. The Kurdish gas, which is of critical importance for Turkey in terms of its dependency on Russian and Iranian energy, came to the table at the Atlantic Council Energy and Economy Summit.
"Two years ago, I said the KRG would be a major oil exporter. Now I talk about something different as 150 billion cubic meters of gas has been found and a total of 5 trillion cubic meters of gas will be explored in the region. This amount can satisfy Turkey's gas requirement for 50 years," Hayward said.
According to Hayward, Iraqi Kurdistan currently has 300 to 400 billion cubic meters of gas. With the start of gas exports to Turkey, Turkey's dependency on Russia and Iran will decline and it will be able to purchase cheaper gas.
Hayward said a joint venture gas company will be established with a build-operate-transfer model financed through a model that will jointly include international and Turkish partners. The company, which is scheduled to be founded in 2016, will be financed after gas sales begin. He stressed that in early 2020, the first batch of KRG gas is planned to enter into the Turkish market from where it will then reach the European market. KRG Natural Resources Minister Ashti Hawrami said gas production has started and gas will come to Turkey after the first phase is completed with a 12-month delay in the schedule. Concerning the transport of KRG gas to Turkey and Europe, Hawrami said Turkey has the needed infrastructure, with the exception of few details, to receive the gas and transport it to Europe.
Hawrami added that a new agreement has been made with the new KRG government, but fiscal discipline cannot be ensured in the country because of DAESH. The KRG's budget deficit rose to $7 billion from $2 billion in the first six months of the year. It failed to pay the salaries of 1.4 million employees for some time, including peshmerga troops fighting DAESH. Hawrami called on the international community to directly support peshmerga troops.