As Baghdad grapples with Sadr City, Iraqi Kurdistan busily builds 'Dream City'
The Kurdistan Regional Government is briskly pursuing oil and gas contracts and economic development, a drive that is chafing Iraq's central government in Baghdad.
ARBIL AND SULaymaniyah, Iraq
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"We believe there are huge gas reserves under the ground in Kurdistan," says Mr. Wajid, an Iraqi Kurd and executive with United Arab Emirates-based Dana Gas, whose company is in the final stages of negotiating over a 14.7 square mile plot of land for the $20 billion project.
Dana Gas has already invested $650 million in Iraqi Kurdistan to extract gas, build a liquefied petroleum gas (LPG) plant, and transport the fuel to new power plants in the region. "This area will transform economically in a massive way.… It will be a revolution," says Wajid from his office in the northern Iraqi city of Sulaymaniyah.
Further north in Arbil, the region's capital, authorities are finalizing a deal estimated at $12 billion with a consortium of South Korean companies that will give the energy-starved Asian country access to several oil fields here in exchange for investment in infrastructure projects in northern Iraq.
Over the past year, the Kurdistan Regional Government (KRG) has briskly awarded oil exploration and production contracts to foreign companies. The roster now includes the likes of America's Hunt oil, Austria's OMV, and Russia's TNK-BP. And all of this is happening in defiance of the oil ministry and the central government in Baghdad.
But as the government of this semiautonomous region, home to about 4.5 million people, forges ahead with its ambitions to transform this long deprived part of Iraq, it must maneuver through many external and internal challenges.
For average Iraqis, and some in the central government, Iraqi Kurdistan's actions are nothing short of its efforts to lay the foundations for independence. In many neighboring countries, particularly Turkey, which is waging a war with its own separatist Kurdish rebels, sometimes in Iraqi Kurdistan, this is cause for alarm.
Last Thursday, the KRG held rare talks in Baghdad with senior Turkish officials partly to allay these concerns.
Even inside the region, discontent is rising among many residents who see little benefit from big projects and are starting to question the motives and capabilities of the two main ruling parties – the Kurdistan Democratic Party (KDP) the Patriotic Union for Kurdistan (PUK) - that have had a grip on power for decades.