Turkey in talks with US Chevron for KRG: Sources

Merve Erdil - Hürriyet / ISTANBUL

Chevron and Turkish officials are talking about the new pipelines construction in the KRG, according to sources. Hürriyet photo

After Turkish Prime Minister Recep Tayyip Erdoğan’s announcement that a Turkish company would be partnering with the Kurdistan Regional Government (KRG) and Exxon Mobil to carry out oil exploration in northern Iraq before his U.S. visit last week, Turkey is now reportedly in talks with U.S. energy company Chevron about activities in KRG.

Turkish officials and the executives of Chevron have been talking about oil and natural gas pipelines that are planned to be built from the KRG through Turkey, according to sources.

However, Exxon is also looking for a partnership with Turkey in the KRG, and Chevron’s approach to Turkey is reportedly different to Exxon’s. Chevron executives and officials from Turkey’s Energy Ministry are also negotiating on the construction and the financing of the new pipelines, the sources said.

During Erdoğan’s U.S. visit, he was expected to seek Obama’s support for further energy deals that Turkish companies are hoping to strike in northern Iraq. “An agreement was in place for a Turkish company to become a partner with Exxon and the KRG, and details will be clearer after the U.S. visit,” Erdoğan had said. Exxon, a global oil company based in Texas, was the first to sign up for exploration deals with the KRG. Others including Chevron, Totali and Russia’s Gazprom Neft have followed.

Washington, wary of the divisions between Baghdad and the Kurdish region, has urged the passage of a long-delayed national oil law to resolve the standoff, which has intensified since the last U.S. troops left in December 2011.

The partnership, which runs parallel to Turkey’s ambitions to become a regional energy hub, threatens to worsen a long-running dispute between Baghdad and the autonomous Kurdistan region in northern Iraq over how to develop the country’s energy wealth.

In November, Baghdad blocked Turkish national energy firm TPAO from bidding for an oil exploration contract, a decision that Erdogan had said was not “smart business.” And in December, Baghdad barred a plane carrying Turkish Energy Minister Taner Yildiz from landing in Arbil, as he was reportedly on his way to seal the much-speculated energy deal.