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Kurdish Authorities Say Dana Gas, Crescent Violated Contract Over Gas Supply to Iraq

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Iraq's Kurdistan Regional Government, or KRG, has accused Dana Gas and Crescent Petroleum of breaking their contract by failing to inform it of the start of gas supplies from the Khor Mor field to Iraq's Electricity Ministry, it said on Thursday.

It is now planning to take appropriate measures to protect its contractual rights, it in a statement.

The KRG said it was eventually informed at the same time as the publication of the companies' public announcement and said that the companies had acted unilaterally in arranging the supply to Iraq, in breach of their obligations.

The statement said that this "represents an unwarranted interference in the institutional arrangements governing the relationship between the KRG and the Federal Government."

Dana Gas and Crescent said a total of $4 billion had been invested in the Khor Mor field in Kurdistan and that they would supply 100 million standard cubic feet of gas from a related processing facility to Kirkuk Taza power station, initially for one year, to boost power supply.

The Kurdish government said it worked in a spirit of cooperation with Iraq on the strengthening of energy security and has invested significant sums to that end, never opposing supply to Iraq via contractors who first seek approval.

Neither Dana Gas nor Crescent had informed or liaised with the KRG in advance of the allocation to Iraq, it said.

"The operators' actions are particularly disappointing because the KRG has repeatedly requested additional gas supplies for facilities that had more demand for gas supplies and in which KRG has invested substantial public resources," the statement said.

"Those facilities were developed not only to strengthen electricity supply within the Kurdistan Region but also to expand electricity generation for the benefit of the people of the Kurdistan Region and Iraq. Instead of working with the KRG to achieve these shared objectives, the operators chose to proceed unilaterally."

The statement ended saying that the KRG "rejects" the operators' "misleading"Aug. 4 public statement of thanks to the KRG for its support of these gas supplies, given this was never approved nor authorized.

has contacted Dana Gas,

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