KNOC payments to the KRG for the Bazian block: a Korean MP's claim that USD 31.4 million went missing and a Seoul court ruling against the newspaper that published it (2015)
In March 2015 the Korea Times published claims by Chun Soon-ok, an opposition member of South Korea's National Assembly, that USD 31.4 million paid in 2008 by the Korea National Oil Corporation (KNOC) to the Kurdistan Regional Government as a signature bonus under its production sharing contract had disappeared after being sent to an HSBC account in London given by Natural Resources Minister Ashti Hawrami. On 12 March 2015 the KRG Ministry of Natural Resources rejected the claims as false. It said KNOC had paid USD 235.5 million in 2008 under its contracts for the Bazian block and others, including the USD 31.4 million, into the KRG's HSBC account in London, and that the money was fully accounted for and had been spent in the normal course of government business. According to the ministry, on 8 June 2015 the Seoul Western District Court, ruling on an application by KNOC against the Korea Times, ordered the articles deleted and found no reason to conclude that the payments were bribery or went to associates of former President Lee Myung-bak. No audit of how the money was spent was found.
- Period
- From December 2008 to June 2015
- Sector
- Kurdistan RegionOil contracts with foreign companies
- Kind of case
- Civil case or arbitration
- Jurisdiction
- South Korea; Kurdistan Region
How the money moved
Signature bonus and capacity building payments by a foreign state oil company under production sharing contracts, paid into a KRG account abroad outside the federal treasury.
What happened
The Seoul Western District Court found the published claims untrue in a case between KNOC and the newspaper (8 June 2015, as reported by the KRG). No investigation of the payments in Iraq or South Korea is known.
Open questions
- How the USD 235.5 million paid by KNOC in 2008 was spent and recorded.
- Whether the Kurdistan Parliament, the Region's Board of Supreme Audit or the federal Board of Supreme Audit examined the HSBC account.
People and companies
| Name | Role in the case | Legal status | Detail | As of |
|---|---|---|---|---|
| Ashti Hawrami آشتي هورامي | KRG Minister of Natural Resources; the HSBC account in London for KNOC's payments was given by him, according to the Korean MP | Not charged as of the date of writing | Not charged as of the date of writing. In March 2015 a South Korean opposition MP, Chun Soon-ok, claimed that USD 31.4 million paid by KNOC in 2008 to an account he provided had disappeared. The KRG rejected the claim, and according to the KRG the Seoul Western District Court found on 8 June 2015, in a case between KNOC and the Korea Times, that the published claims were untrue. | 19 October 2026 |
| Korea National Oil Corporation (KNOC) المؤسسة الوطنية الكورية للنفط (كنوك) | South Korean state oil company; party to production sharing contracts with the KRG including the Bazian block; paid USD 235.5 million in 2008 | Not charged as of the date of writing | Not charged as of the date of writing. According to the KRG, KNOC paid USD 235.5 million to the KRG in 2008 under its production sharing contracts and in 2015 obtained a ruling from the Seoul Western District Court ordering the Korea Times to delete articles alleging misuse of the money. No accusation against KNOC itself is known. | 19 October 2026 |
Sources
- Kurdistan Regional Government, Ministry of Natural Resources12 March 2015Government statementTier A
KRG Statement on Article in the Korea Times
Document (saved page)Original addressSHA-256 a6e3f6734ae9In fact in 2008, KNOC paid a total of $235,500,000 (which included the $31.4 million amount referred to by the Korean MP) to the KRG as part of its contractual obligations under the PSCs.
- Iraq Business News18 June 2015Government statementTier B
Korean Court Rejects Claim of KRG Bribery
Original addressThere is no reason for this Court to make a conclusion that the money paid to the KRG by the Creditor is either bribery or was distributed to the close associates of [former President] Lee Myung-Bak.
- Iraq Business News13 March 2015Press reportTier D
KRG Rejects Korean Corruption Claims
Original addressKorean MP Chun Soon-ok claims that $31.4 million (36.6 billion Iraqi dinars), given as a signature bonus by the Korea National Oil Corporation (KNOC), disappeared after the KNOC sent it in 2008 to HSBC in London