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No matter what you may think of our Turkish freinds, the Iraq side signed a legal contract (amendment 2010) to utilize the Ceyhan Pipeline by exporting 35 Million tons pa. - at an agreed (and indexed) $/bbl tariff.
You know the density of SH crude and you can estimate the density of KBT +/- so you can see very clearly how much money the Turkish side is losing thru non-adherence to contract terms.
The tariff agreed for 35MTA (now historical of course) was $1.09/bbl Indexed).
A LOT of money involved here...

Middle East Eye reporting so:
Published date: 17 April 2023 14:05 BST
Turkey is considering petitioning a federal US court to enforce a $527m arbitration award it won against Baghdad over disputes regarding crude oil exports from Iraq's autonomous Kurdistan region, two sources familiar with the matter told Middle East Eye.

The move is seen as a retaliation against Iraq, which last Monday filed a petition to the same court in Washington DC to enforce an arbitration award worth $1.4bn it won against Turkey.

Officials in Ankara have been dismayed by Baghdad's non-engagement over the issue, the sources said.

Baghdad's petition, filed with the US District Court of the District of Columbia, has requested that the court move ahead with "Recognizing, Confirming, and Enforcing the Final Award issued by the Arbitral Tribunal".

putup,
it's no consolation, but the Basrah (heavier) crudes all seem to go East - where a great deal of Refinery Investment has taken place in recent years - to squeeze the last drop of valuable constituents from the heavy stuff.
In contrast, the heavy Kurdish crude seems mostly to head to European refineries - where large-scale investment has been frowned upon for years now (one or two exceptions prove the rule), so they are not able to squeeze out as much value per barrel - which then translates to "not offer as much per barrel".

SOMO will aim to have an Official Selling Price (OSP) for the KBT kurdish blend - as it has for the other 3 Iraq blends.
The OSP, however, is not "Gods word unto man" but rather the RRP of the oil world - it will form the basis of the larger- and more long-term contracts, but for any deals other than those it's purely a demand-led deal between buyer and seller. You will see SOMO's (and other) OSPs regularly "adjusted" to reflect this.
In the same vein, but even more so in the Kurdish context, variations in crude quality will be regularly checked by buyers and the "agreed" price adjusted according to simple yield parameters confirmed by lab checks (either prior to load or retrospectively, major players have agents worldwide who can locally inspect and verify). ALL major crude exporting terminals, such as Ceyhan, have independent local labs able to carry out simple distillation yield analysis. Depending on the outcome of that analysis, buyers always have the right to demand compensating adjustment. The KBT parameters, in times of fluctuating or rapidly rising output, will require close monitoring and will fluctuate accordingly. KBT will not be a stable blend like Brent - there are far too many formations contributing and, thanks to the relatively long shut-in, grade stability at re-start and for some time thereafter will be all over the place. As I said, refinery demand at any one time will drive the discount. My own estimate of SH crude value is currently Brent - $28/bbl. but the new transportation fees/tariffs will need watching and could seriously affect this estimate.

TM, good morning.
For my sins I have to admit to being an engineer, R&D early in my career; as such I generally prefer Kristina Guo's DECIDE approach but I do understand the attractions of the OCCAM razor.
No matter, thank you for posting up the esmap article which I already have but thanks to you I had an excuse to re-read and brush up.
Years ago (2014) I discovered Platts Technical Papers relating to differentials to be applied for API, Sulfur, TAN, etc. and we did a lot of work trying to "make it all fit". Needless to say, it never did fit all of the time (still doesn't) but we did get it quite close most of the time.
What often throws a spanner in the works is the need (urgent need) that refineries might have for a particular blend, even a very heavy blend. The distillation fractions of a particular crude, or blend, can be so appealing that refineries can bid it very high if their plant (slate) requires it at that particular time.
Re the $16/bbl issue, I guess traders generally bid on behalf of refiners - although the larger, more successful and more gutsy trading houses have their own book (supported by storage as required) so the need to fully utilize your (complex) refinery drives the bid. I haven't been able to correlate the Nelson Index Refinery List with KBT buyers but that would be an interesting excercise - if possible.

Hi again TM,
I guess by now you must have done the simple method and reached 27?
That's what I reach after using the "official" parameters - very neat, but I'm rather wary of anything that turns out too neat and have run many iterations with other variables , reaching quite different conclusions. The biggest variable is of course the Khurmala feed.
Re yr final point - it's not just density (API), the Sulfur% effect is not to be taken lightly.

Hi TM,
I’m not able to point you at a particular document that will give you the export grade number, sorry. My range is 24-25API.
If, as I am sure you have done, you go back thru the years and try to evaluate what you find ref. Kurdish Blend, you rapidly find all sorts of conflicting information – whether it’s from Platts, Argus or wherever, it never quite seems to gel.
The 2017 grade mentions indicate API-27 or thereabouts, but as the main volumes come from the KRG-controlled and KAR-Group managed Khurmala formations (excluding now Bai Hassan and Avana), that density has deteriorated markedly over the years (used to be ca API-33); you will find other refences from 2018 onwards which confirm that. My current estimate for Khurmala is 31 Max, 29 Min (mean varies acc to which formations are giving most trouble at any one time and there are several dozens of wells tapping Khurmala!). There are lots of misleading articles written about Iraq export grade qualities – most of it based on historical data and very little based on up-to-date info. I suppose that suits the powers that be.
I prefer to gather info from all the producing Iraq- and KRG-controlled fields that I can and build up my own calculation & view of the KBT blend. The main producers are easily found, their current outputs less so, but even that will show that the high-twenties cannot be. Once you start adding the low-volume, heavy producers scattered around it lowers the blend number quite a bit.
There are several web tools available that can help here – an easy one to use is Crudemonitor.us where you can plug in your volumes and grades and get an accurate idea of blends. My current KBT model incorporates data from 12 different blocks/producers, and beforehand of course you have to convert the barrels to weights, so you require the different densities - that takes some digging!
I’m happy with my calcs and my estimates but I’m always ready to eat humble pie if these can be shown to be way out.
Sorry I couldn’t give you an easy answer – Friday’s always busy for me.

As an aside: The loss to the KRG/MNR of Bai Hassan and Avana (Oct-2017) makes a historical comparison of both volumes and grades difficult – these were big export contributors, producing about the same as Khurmala currently does.

Just had a look at Marine Tracker. If all ships have their transponders on, then it appears that only 4 tankers are waiting to load.
Neverland 105,411T DWT (old friend, port of origin is FALCONARA, IT)
Advantage Anthem 116,087T DWT (THESSALONIKI ANCH, GR)
PS Genova 108,983T DWT ( port of origin is AUGUSTA, IT)
Nissos Kea 300,323T DWT (port of Origin is LIANYUNGANG, CN.)
Assuming KBT crude blend density of API24 (or 6.9stb/ton) what might that waiting capacity tell you?

Hi Belgrano, you do primary reformer in naphtha splitter?

Yes, I saw the 50% fuel oil output and didn't want to believe it.
Either they are shipping it (truck?!?) to a better processing refinery (don't laugh please) or they are still filling their cars and trucks with unbelievably low-quality fuel. If that's the case then the air in downtown Baghdad must be worse than Mexico City...

Hi Belgrano, the refinery whose maintenance I was in charge of didn't incorporate a Coker - for which I'm quite glad.
We had a really bad H fire once that destroyed a lot of other equipment and it was hairy! The Coker runs v hot I understand (ca 480-500?) and what with H, NH3 and H2SO4 "bad events" in my life I'm happy to be (more or less) out of it now.

Thanks Val, I saw that as well, that but apart from the words CDU/ADU I haven't been be to track down any of the other process modules!
I hope they didn't call a halt at atmospheric distillation !

Hi ValueS and Belgrano, always good to get some resonance about real stuff.
I've been trying to get good info on the state of the Baiji refit but apart from specs on the CDUs I'm not having much luck. Due to its closeness to the Kirkuk domes it should, hopefully, once again become a major refinery complex fir Iraq.
The specs for the Karbala modules are all out there and it looks like they've made a first-class attempt at building a hi-spec refinery - CDUs, VDU, HDS, Naphtha splitter/Reformer module, Isomerization module, hydrotreater unit, catalytic cracker, etc. The Works ! I didn't see a Coker Unit mentioned but I did see an Asphalt Unit AND a Sulfur Recovery Unit. Lets hope they maintain it properly!

Hi Belgrano,

Re feeding heavy ends back into an export feed: I hope they have learned the lessons of the past and are not doing this! It is Iraq-Kurdistan, however, and greed does tend to triumph over all else, so who knows? There are many pockets to be filled and many favours to be returned.
Before Baiji Refinery was expanded and its complexity greatly increased, it was very common to re-inject the heavy ends back into some of the Kirkuk formations. The resulting damage to these formations can be felt to this day. This was a state management decision taken to "tart up the numbers" and, since the major destruction to the Baiji facilities (DAESH) and the limited alternatives available, who knows what levels of technical expertise have been compromised.
The lack of hi-complexity refineries (Nelson), able to extract every penny of value from the feedstock, is a major stumbling block, both for Iraq and for the semi-autonomous Kurdish region.

I offer the thoughts below purely as an indication of what other parameters / issues are open to the Iraq Gov and SOMO as they battle to overcome KRG resistance to the new world order.

Reflecting the increased production of heavier grades as more Southern fields came on stream, in Nov-2020 SOMO starting marketing a new grade of Basrah crude and changed the spec of 2 other grades, bringing their slate to 3 grades:
New is Basrah Medium, with an SG of around 27.9 API and sulfur content of ca 3.00%.
Amended is Basrah Light, now with an API of 31.40 and sulfur content of ca 2.74%.
Amended also is Basrah Heavy, now with an API of 24 and ca 4.05% sulfur.

The KRG currently markets only one grade – KBT with an API of ca 24 and sulfur content of ca 4.5%-5% (both variable).
To the best of my knowledge, the low volumes of Taq Taq crude now being produced (champagne crude as it was once called) now go exclusively to the KAR refinery.
Contributing to grade enrichment of the heavier KBT constituents (Shaikan, Atrush etc) are large volumes of high quality crude from the KAR-managed Khurmala dome (plus nearby Avana, Bai Hassan fields) AND the high quality crude from the HKN-managed Sarsang field.

The above presents SOMO with some possibilities, perhaps even a little bit of a dilemma.

Firstly – management of the 3 Kirkuk Domes.
The Kirkuk formations were first discovered in 1927 (Baba Gurgur), and Kirkuk has a lot of emotional significance for the Iraqi government and people.
KAR Group has, since the DEASH incursions, and on behalf of the KRG/MNR, pretty well managed output from both the Khurmala dome (claimed by KRG) and the Avana, Bai Hassan and several smaller nearby fields (claimed by Baghdad). KAR has invested significantly in processing plant and much of that output now goes into the Kurdish export pipeline and onwards to Ceyhan; being so very close to the Barzani family KAR also makes a lot of money from its activities.
Unlike GKP, HKN and Shamaran, however, KAR Group did not discover oil at these places – seen through SOMO eyes it acts purely as a producing contractor.

Second – grade marketing.
How should the KBT grade be priced relative to the Basrah Heavy offering?
Would it make sense to attempt to market 2 Kurdish grades?
Could the 2nd Ceyhan pipe be economically repaired in a sensible timescale? What would Turkey demand in return?
Would it make sense to divert, say, the high-grade Sarsang crude down to the Basrah processing facilities to help grade stabilisation down South?
Would it make sense to return the Avana and Bai Hassan output to the Basrah facilities?

As I said, there is a LOT of discussion about a LOT of other things going on - all of them very relevant.

Says surreyscot aka highlander7 , part of the cabal of real fraudsters on the other board that have polluted the debate about GKP for years , spinning their lies and deceit about how wonderful everything is with the company and the SH wells, how there is no water being produced, how easy and cheap it will be to deal with the sour gas issue, how the high Sulphur content is not a problem as S is so easy to remove and is so valuable anyway, how the SH-6 water well was a real beauty, how there is no danger to the KRG from Baghdad interfering with contracts, how the brave Kurds can face down anything that Baghdad throws at them, how the ICG ruling is meaningless and how, if things do get rough how the USA is going to come to the rescue of the KRG, Barzani and his clan.
Well, at the end of the day the Iraq Army didn't have to march into the export station at Faysh Khabur - the keys were given to them.
Visit the other place and make up your own mind as to who con men really are and ask yourself, why do they do it, who do they work for?
Perhaps we should adopt the food packaging labelling - "Warning - may contain nuts!"
As they say, Caveat emptor

Heh Mr GRH1, sailing under false colours...

It's still there - completely unedited for you to enjoy.

And that just shows how ignorant and devious you are!
I stated that the Iraq army could take over the Export Metering- and Pumping Station at Faysh Khabur - nowhere did I opine that it could or would take over Kurdish oilfields.
People - be warned about this particular poster!

I expect the Iraq-Turkey pipeline agreement to be amended very shortly - the unrealistic tariff rates from 2010 (last amendment) to be increased (cost more) and the annual guaranteed throughput numbers to be revised yet again.
I also expect the Kurdish PSC terms to be severely modified (downgraded), with the Profit Oil element being the one to suffer most. The Cost Oil element (currently max 40% for GKP/MOL) will also be under attack in my opinion, but reducing the existing, generous CO payback rate will greatly effect the willingness (and ability) of the OilCos to speedily implement future expansion plans - especially gas plans, so that might give cooler heads pause for thought. I certainly wouldn't rule out cancelling dividend payments until all of this mess has been settled.

Good mornin Armas,
have a look at what happened to the previous attempts to utilize the WSW routes...
Bandit Country, everywhere you look.
Now, looking at the Southern route possibility, why would you want to put all your eggs in one basket...again?