The Kurdistan Regional Government says it neither approved nor authorized gas deliveries from the Khor Mor field to Iraq’s Ministry of Electricity, launched in early August by Dana Gas and Crescent Petroleum.
August 7, 2026 — energynews
The Kurdistan Regional Government (KRG) publicly rejected, on August 7, 2026, the account given by Dana Gas and Crescent Petroleum of the start of gas deliveries from the Khor Mor field to Iraq’s Ministry of Electricity. The two operators had announced the launch on August 4, 2026, describing it as a major milestone for the regional gas sector. The KRG says it neither approved nor authorized the launch, and states it was only informed of the deliveries at the time of the operators’ public announcement.
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An agreement disputed by the contracting authority
The Khor Mor field, located in the Kurdistan Region of Iraq, is operated by Dana Gas and Crescent Petroleum through the Kurdistan Gas Project, a structure also known as Pearl Petroleum. This contractual arrangement was originally concluded with the Kurdistan Regional Government, which claims oversight over any redirection of gas flows extracted on its territory. The destination of the gas toward power generation echoes issues seen elsewhere, as gas-to-power ambitions in several regions raise questions, much like the reshaping of regional gas markets observed elsewhere. A commercial agreement signed in December 2025 between the operators and Iraq’s Ministry of Electricity provides for gas supply to a power plant in Kirkuk province.
At the August 4 announcement, the leadership of Dana Gas and Crescent Petroleum thanked their institutional partners, including the KRG, for their support of the project. The regional government denies any involvement in the decision and considers that the operators acted in breach of their contractual obligations toward it as the project’s contracting authority. It states that, before this episode, it had repeatedly requested additional gas volumes for infrastructure in which it had itself invested significant public resources, intended to increase power generation both for the region and for the rest of the country.
Processing capacity expanded through the KM250 project
The Khor Mor site recently benefited from a processing capacity expansion project known as KM250, which increased the volume of gas that can be processed on site. The expansion opened the possibility for the operators to market additional volumes beyond the Kurdistan Region’s local needs, notably toward the rest of federal Iraq. It was in this context that the December 2025 agreement with Iraq’s Ministry of Electricity was signed, before materializing into the deliveries announced in early August 2026.
The field supplies most of the Kurdistan Region’s power generation and represents, according to the operators, a substantial cumulative investment as well as a significant number of direct and indirect jobs. This economic weight heightens the political sensitivity of any dispute over the allocation of produced volumes. The disagreement illustrates the tension between the operators’ interest in monetizing expanded processing capacity and the KRG’s intent to retain control over the final destination of gas extracted on its territory.
A dispute set against an already tense backdrop
Comparable disputes, concerning the need for prior approval from the regional authority before any gas transfer to federal Iraq, have previously been documented in Iraqi Kurdistan. The Khor Mor field has also experienced, in the recent period, several production suspensions linked to security threats. This climate heightens the sensitivity of any decision affecting the distribution of gas flows between the autonomous region and Baghdad.
The episode also fits into a broader energy dynamic, with Iraq seeking to reduce its dependence on Iranian gas imports for power generation. This orientation gives growing strategic importance to volumes originating from Kurdistan. Neither the Kurdistan Regional Government nor Iraq’s Ministry of Electricity have, at this stage, specified how the dispute might be resolved.
