Despite Friction, Turkey Pursuing Energy Deals with Arbil, Baghdad

Despite Baghdad’s harsh reaction to the Iraqi Kurdish Regional Government’s exports of crude oil to Turkey, Ankara plans to move ahead with new energy cooperation projects with the Iraqi government.

A technical delegation from the Iraqi government will visit Turkey shortly for negotiations on the Basra-Kirkuk pipeline project agreement, an official from the Ministry of Energy told the Hürriyet Daily News yesterday. “The Kirkuk-Ceyhan pipeline operates at a capacity of only 35 percent. The Basra-Kirkuk line will increase the capacity for oil transported to Ceyhan,” the official said, adding that Iraq had requested the project.

Ties with both sides

Elaborating on news reports that Baghdad has declared Turkey’s import of crude oil from the Iraqi Kurdish government to be illegal, the Turkish official said the problem was between Iraq’s central government and Arbil, not with Turkey. Ankara is enhancing energy cooperation with the Iraqi government as well as the regional government, the official said.

The Kurdish Regional Government began exporting an unspecified amount of crude oil by truck to Turkey last week, where it can be refined into various products before being taken back to northern Iraq, the official said.

However, the central government in Baghdad insists that it reserves the sole right to export oil, which accounts for the lion’s share of the country’s income.

The Iraqi government said crude-oil exports from northern Iraq to Turkey were “illegal” and threatened to take “appropriate action,” in a continuation of recent tensions between the two.

“This is an illegal and unconstitutional business that we will take the right decision on,” said Faisal Abdullah, spokesman for Iraq’s Deputy Prime Minister for Energy Hussein al-Shahristani.

“The Oil Ministry [in Baghdad] solely reserves the right to export crude oil, gas or oil products to other countries,” Mr. Abdullah said.

A dispute over oil between Baghdad and the Kurdish government in Arbil has worsened recently, with Iraqi Kurds having stepped up oil production and export capabilities, and also cutting off oil exports to Iraq in a payment row.

The Kurdish Regional Government has signed dozens of contracts with foreign oil firms, despite the central government saying that all oil contracts must go through Baghdad.