More drilling planned for Kurdish north of Iraq

Feb. 9 (UPI) -- Steady payments from the Kurdish government in Iraq and improved market conditions means it's time to start drilling more, Norwegian company DNO said.

DNO said it received $210 million in payments last year for crude oil exported from its Tawke field in the Kurdish north of Iraq. So far this year, the company received $59 million from the semiautonomous Kurdish government for crude oil exports.

"These payments create momentum as we move into 2017," DNO's Executive Chairman Bijan Mossavar-Rahmani said in a statement.

Provided those payments continue, the company said it planned to drill three more wells at its flagship Tawke field with the aim of bringing production to beyond the current rate of 115,000 barrels per day.

Third quarter profit of $19.8 million was better year-on-year and year-to-date figures vastly outperformed the previous period. The company reported a full-year 2016 operating profit of $6 million, compared with a $174 million loss in 2015.

The company said it was planning to spend $100 million on further developments at the Tawke site in northern Iraq.

Iraq agreed to cut about 210,000 bpd from its production under the terms of a managed decline agreement coordinated by the Organization of Petroleum Exporting Countries, but has fallen short of the benchmark. The central government in Baghdad said in the past that the semiautonomous Kurdish government wasn't doing its share.

Iraq in the past had balked at production restrictions, arguing it needed a steady revenue stream to support the fight against the Islamic State terror group. Most of the fighting against the terror group has been centered near the Kurdish north.