The agency said that it has reviewed documents showing that the Kurdistan Region’s oil production could rise to 580,00 barrels per day in five years, but it could also fall to 240,000 barrels per day if new investments are not made.
It added that as old oil wells are becoming depleted unless new exploration or major investments are made, a drop in oil production is the likely scenario.
Member of the Kurdistan Parliament's oil and gas committee, from the Patriotic Union of Kurdistan (PUK), has described the latter scenario as "very dangerous."
Karwan Gaznay said that it is not a real problem if Erbil and Baghdad relations are back to normal which will allow the Region to "develop new blocks and increase production, we have a lot of reservoirs."
If production drops significantly, the Kurdistan Regional Government (KRG) "would compound economic woes of a region already struggling financially within an unstable Iraq," Reuters said citing diplomats, officials, and energy experts.
In July, Deloitte, an international professional services network, said that the KRG exported 36.45 million barrels of oil to the world’s oil markets in the first quarter of 2022, which is lower than the previous year totalling 152 million barrels of oil.
This drop in oil production comes from declines in three major oilfields - Tawke, Khurmala and Taq Taq.
A KRG source told Reuters that "the reason that the current oil production is going down is due to the inability of the ministry of natural resources to bring timely additional investment online to overcome the natural decline of 15% to 20% each year in production for each well."
Erbil and Baghdad disputes started after the KRG started exporting oil through Turkey and taking the income without referring back to the federal government.
In February, the Federal Supreme Court issued a verdict that the KRG law on the independent sale of the Region’s oil and natural gas was against the Iraqi constitution.
KRG officials, however, have rejected the federal court's ruling and described it as "political".
Following the ruling, several foreign firms, including U.S. oilfield services companies Schlumberger, Baker Hughes and Halliburton have left the Kurdistan Region.
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