DNO Considers Joining Kurdistan Pipeline Deal to Restart Crude Exports to Turkey

DNO is weighing whether to join an agreement that would reopen pipeline exports of Kurdistan crude to Turkey, a move that could lift realized prices after years of local sales following a prolonged shutdown.

(Reuters) — Norway's DNO, the largest oil producer in Iraq's Kurdistan region, said on Feb. 6 it was considering joining an agreement that allows companies to export Kurdish crude via a pipeline to Turkey.

The company declined to sign a deal last September between Iraq's federal government, the Kurdistan Regional Government and eight oil companies to resume pipeline flows after a 2-1/2‑year halt, opting instead to keep selling crude on the local market.

"We can join that agreement at any time we want. And I think the other participants, both the companies and certainly (Iraq's state oil marketer) SOMO, would like that to take place," DNO Executive Chairman Bijan Mossavar-Rahmani said.

Another option was to conclude a bilateral deal with SOMO, which is handling Kurdistan's exports, outside of the tripartite agreement, he added.

It may take until the mid-year or longer to reach an export deal, pending the formation of Iraq's new government following last November's elections, Mossavar-Rahmani said.

DNO has restarted drilling at its Tawke and Peshkabir fields in Kurdistan, aiming to increase gross output to around 100,000 barrels of oil equivalent per day (boepd) from 70,000 boepd last year.

The company said it sold its net entitlement production of nearly 18,000 boepd locally in 2025 at prices in the low $30s per barrel. Pipeline exports could secure higher prices.

"In 2026, we will be either part of the current export arrangements, or we will find another mechanism to be exposed to export pricing," Mossavar-Rahmani told a quarterly results call with analysts.