Russia's Rosneft to fast-track gas export option in Kurdish Iraq

Rosneft said it was finished with the due diligence requirements for an oil export pipeline from the Kurdish north and is in the process of finalizing the necessary legal documents. Total Kurdish oil production isn't as robust as oil fields elsewhere in the country, though the semiautonomous Kurdistan Regional Government aims to increase its potential through exports by truck and through pipelines to the Ceyhan port in Turkey.

Rosneft said Monday it was now ready to consider working with the KRG on new gas pipeline infrastructure and agreements on development could materialize by the end of the year.

"The Kurdistan Region gas pipeline will not only supply natural gas to the power plants and domestic factories throughout the region, but also enable exporting of substantial fuel volume to Turkey and European market in the coming years," the Russian company said in a statement.

Rosneft said the pipeline would be able to satisfy both sets of gas demand pressures, adding the agreement would help it play a leading role in expansions to Kurdish energy infrastructure in general. The project is moving on a fast-track basis and Rosneft said the pipeline could be exporting natural gas by 2020.

The federal Iraqi government and the KRG in 2014 agreed on a budget measure that shares oil revenues, settling simmering disputes between the two.

A referendum for Kurdish independence from Iraq is set for Sept. 25. A spokesperson for the Kurdish government said the referendum would correct past mistakes from Baghdad, including budgetary issues related to oil and entitlements for some of the Kurdish fighters supporting broader counter-terrorism efforts.

The Iraqi economy is robust overall, but non-oil gross domestic product contracted by 1 percent during the first half of the year. Moody's Investors Service said it expected the economy in Iraq will contract by 0.4 percent and continue to slow down at least through 2022.