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Joint venture between US and Iraqi operators to run refinery in Iraq’s Kurdistan region

16th April 2014

Black Diamond Oil and the Rezhwan are to jointly operate a new oil refinery in the Kurdistan Region of Iraq.

Joint venture between US and Iraqi operators to run refinery in Iraq’s Kurdistan region
It is hoped that the new oil refinery will start refining Taq Taq crude oil next week with 1,500 tons being refined on a daily bases.

The refinery near the Kurdish capital Erbil will be operated by the private Kurdish group Rezhwan Co., which will process the crude from purchasing above ground reserves in Taq Taq.

Black Diamond investment partners will keep 70.5 per cent of the gross profits earning USD 180,000 per day on a small USD 60 per ton profit for new petroleum, while Rezhwan will keep the difference after expenses.

It is hoped that the new oil refinery will start refining Taq Taq crude oil next week with 1,500 tons being refined on a daily bases.

Ronald Flynn the founder of Black Diamond said: “I believe we are in good company with heavyweights like Exon mobile, Chevron, and Total working very close to where our refinery is in Erbil Kurdistan. Moreover I am confident we will be able to continue refining crude oil into gasoline for a long time. "

According to OPEC, Iraq's resources of 143 billion barrels of crude oil and 126.7 trillion cubic feet of gas are the fourth largest in the world after Venezuela, Saudi Arabia and Iran. However, Iraq's oil production is almost half that of Iran, meaning there is plenty of room for growth.

Kurdistan accounts for 43.7 billion barrels of proven oil reserves, 25.5 billion more barrels of unproven reserves and between 3 and 6 trillion cubic meters of gas (30% of Iraq's proven oil reserves). If Kurdistan were a country, the amount of oil and gas reserves would place it among the top 10 oil rich countries in the world.

Recently, Iraq's Kurdistan has been one of the hottest spots for the global oil and gas industry. The size of the oil market has lured many iconic oil and gas personalities including Tony Hayward, the former chairman of BP, and has attracted over USD 10bn in investments from foreign oil companies, according to the Financial Times. At first the Kurdistan region attracted smaller regional oil and gas players, but recently industry heavyweights like Exxon Mobil, Chevron and Total has been making deals with the Kurdistan Regional Government.

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