KRG-Turkey oil trade to split Iraq: official

LONDON - Reuters

Oil trade between Kurdistan Regional Government and Turkey remains a threat to split Iraq between Baghdad and KRG, says a senior Iraqi official.

Rising oil trade between Iraqi Kurdish authority and Turkey threatens to split Iraq in two, a senior Iraqi official has said, as the autonomous region ignores Baghdad’s threats of tough action against what it terms illegal exports.

Oil lies at the heart of a long-running feud between the central government and the autonomous northern region of the country. Baghdad says it alone has the authority to control exports and sign contracts, while the Kurds say their right to do so is enshrined in Iraq’s federal constitution.

“If oil from Kurdistan goes through Turkey directly, that will be like dividing Iraq. This is our big concern,” Iraq’s Deputy National Security Adviser Safa al-Sheikh Hussein said on the sidelines of an Iraq conference.

The Kurdistan Regional Government (KRG) started on the path towards economic independence early this year by exporting small volumes of crude oil by truck to Turkey.

The move further angered Baghdad, which threatened action against the region and foreign oil firms working there to stop the exports, which it says are illegal.

KRG crude used to be shipped to world markets through a Baghdad-controlled pipeline running from Kirkuk to the Turkish port of Ceyhan, but exports via that channel dried up in December due to a payment row with Baghdad.

The northern region is now pushing ahead with plans to build its own oil export pipeline to Turkey, despite objections from the United States, which fears the project could lead to the break-up of Iraq.

KRG Energy Minister Ashti Hawrami has said a gas pipeline now being laid can be converted to ship up to 300,000 barrels per day of crude by June.

A broad energy partnership between Turkey and Iraqi Kurdistan ranging from exploration to export has been in the works since last year.