Turkey, Iraqi Kurdistan clinch major energy pipeline deals

[-SINAN-]

Iraqi Kurdistan has finalized a comprehensive package of deals with Turkey to build multi-billion dollar oil and gas pipelines to ship the autonomous region’s rich hydrocarbon reserves to world markets, sources involved in talks said Nov. 6.

The deals, which could have important geo-political consequences for the Middle East, could see Kurdistan export some 2 million barrels per day (bpd) of oil to world markets and at least 10 billion cubic meters per year of gas to Turkey.

During a visit to Istanbul last week by Kurdistan Regional Government (KRG) prime minister Nechirvan Barzani, both sides agreed on the fundamentals of the deals and mapped out technical details for a second oil pipeline and a gas route from Iraq’s north to Turkey, sources involved in the talks said.

“It is official and it is historic,” a source close to the deal said. “For years, Turkey has deliberately avoided getting involved in northern Iraq but now it is the beginning of a new period. It was a bold but a very necessary move.”

Turkey’s courtship of Iraqi Kurds has infuriated Baghdad - which claims sole authority to manage Iraqi oil and says Kurdish efforts towards oil independence could lead to the break-up of Iraq. It has also raised concern in Washington.

Under Iraq’s constitution, all oil export revenue goes through Baghdad. The autonomous Kurdish region is entitled to 17 percent of the total, a windfall that has helped it flourish as a prosperous oasis safe from the violence that consumed the rest of Iraq in the decade since a U.S.-led invasion.

Turkey has repeatedly said it respects Baghdad’s sensitivities and will not take any steps that would further deepen the long-standing dispute between the Arab-led central government and the Kurdish-run enclave.

Ankara has set up the Turkish Energy Company (TEC), a state-backed entity which has struck partnership deals with Exxon and will be Turkey’s counterparty in dealings with Kurdistan.

A first KRG-sponsored oil pipeline, which is almost complete, will link up to an existing Iraq-Turkey pipeline and begin carrying Kurdistan’s oil to world markets from December, sources familiar with the project say.

The existing pipeline from Kirkuk to Turkey’s Mediterranean port of Ceyhan is currently carrying only a fraction of its 1.6 million barrels per day (bpd) capacity, and could in theory pump up to 700,000 bpd of Kurdistan’s oil.

“A second pipeline will be mainly for the heavy oil that will come from the northern fields. Taq Taq and Tawke crude is very high quality and blending the two grades would depreciate the value of both crudes,” the source close to the deal said.

Turkish state pipeline company Botaş will be instrumental in building the second pipeline, a government source said. A private Turkish company is also interested in the project.

The new pipeline will have a capacity of at least 1 million bpd of crude oil, KRG natural resources minister Ashti Hawrami said in Istanbul last week. The exports will be metered independently, he said, inviting all parties including Baghdad to send auditors to observe the process.

Revenues will be paid into KRG accounts, a source familiar with the plans said. Hawrami has repeated the KRG’s readiness to send 83 percent of the income to Baghdad after deducting the autonomous region’s share. Baghdad views such plans as illegal. “The KRG says this oil belongs to all Iraq and they are happy to share it. There is also a bit of a hope that the reality on the ground will force Baghdad to make a deal on this,” the source said.

With the new pipeline from Kurdistan, Turkey will be able to import at least 10 billion cubic meters (bcm) per year of Kurdish gas more cheaply than from current suppliers, sources said, with its total capacity potentially up to double that.

A gas purchasing agreement between TEC and Kurdistan is expected to be signed in December, sources familiar with the project said. Construction of the pipeline and gas processing plants, anticipated to cost billions of dollars, could start next year, with the first flow of gas targeted for early 2017.

 

[olcayto]

Holy crap,

Doritos is going to kick our asses

 

[Doritos11]

Holy crap,

Doritos is going to kick our asses

KRG can sell their oil, not our business.
Iraq is criticizing them as it's against the constitution of the country officially, it's part of a political game, we have Sharistani as energy minister he's pretty well educated making good deals, I don't know much about oil anyway.

 

[olcayto]

KRG can sell their oil, not our business.
Iraq is criticizing them as it's against the constitution of the country officially, it's part of a political game, we have Sharistani as energy minister he's pretty well educated making good deals, I don't know much about oil anyway.

So basically the Central government won't pay them a dime anymore, whichall the rrevenues north Iraq will make would come from oil and gas export?

 

[Doritos11]

So basically the Central government won't pay them a dime anymore, whichall the rrevenues north Iraq will make would come from oil and gas export?

Depends on parliament.
Sadly we are paying our "enemy" ~17-20% of the central gov budget, since Baghdad is more of a democracy.
KRG is not a democracy but family owned Barzani monarchy.

Mustafa Barzani the father of Massoud

In KRG parliament
- Massoud Barzani president
- Nechrivin Barzani Prime minister
- Masrour Barzani
Probably more from Barzanis family in parliament yet he calls himself democratic.

I think they will cut the budget share once they start exporting their oil, they need to wait for that reason, if we had a dictatorship the budget share would have been cut years ago.

Turkey tries to get most economic gains by buying cheap oil from KRG and having most construction project in the rest of Iraq. The Kurdish independence problem remains everywhere, it isn’t solved in Iraq either as Barzani wants to expand with the money he's paid from Iraq.. he will have to be dealt with later as his nationalism knows no boundaries, it has always brought problems.

 

[Bahoz]

Lol. Dude, Iraq is as much as a democracy as Kurdistan Regional Government. They are under the same central constitution. They are merily a federation which can make some special decissions within its own regional government. That the Barzanis are some times over represented is not automatically a sign of less democracy. It is natural, when most people in Kurdistan consider the Barzani family as a great contribution to the Kurdish struggle. Especially the older generation of Barzanji and Mustafa Barzani...

So where ever the central government lacks in democracy, so does KRG and virsa versa. Again, they are governed by the same central constitution.

 

[Doritos11]

Lol. Dude, Iraq is as much as a democracy as Kurdistan Regional Government. They are under the same central constitution. They are merily a federation which can make some special decissions within its own regional government. That the Barzanis are some times over represented is not automatically a sign of less democracy. It is natural, when most people in Kurdistan consider the Barzani family as a great contribution to the Kurdish struggle. Especially the older generation of Barzanji and Mustafa Barzani...

So where ever the central government lacks in democracy, so does KRG and virsa versa. Again, they are governed by the same central constitution.

Well, my opinion which I backed up by many Barzani family related in gov. We have our opinions.

Though Barzani keeps calling Maliki a dictator, though take a look at him, puts his family members in the highest positions and he will not leave, he's more of a dictator then Maliki.

 

[Bahoz]

But why should he leave? His party still gets most votes in KRG. This means that the people in the region ( including many of the minorities) supports him to some extend. It is getting more democratic since there is a greater opposition to KDP coming from Gorran - the new party.

 

[Doritos11]

But why should he leave? His party still gets most votes in KRG. This means that the people in the region ( including many of the minorities) supports him to some extend. It is getting more democratic since there is a greater opposition to KDP coming from Gorran - the new party.

I think the commander of peshmerga is also related to Barzani family, is this true ? I think I read it in an article.
Also, Barzani from his father Mustafa is seen as a leader for them by lineage so will the son of Barzani, I doubt he will leave anyday.
PUK/KDP, 1 lead by Talabani and the other by Barzani seen like eternal leaders by some..

 

[Bahoz]

I think you are over estimating their powers.

Peshmerga has a lot of different commanders. I do not think that it is a Barzani leading it from the top.

There is a third line which is actually now stronger than PUK. That is Gorran and its leader is Nawshirwan. He is also seen as a great leader since he was a powerful leader during the uprising against Saddam.

 

[Doritos11]

I think you are over estimating their powers.

Peshmerga has a lot of different commanders. I do not think that it is a Barzani leading it from the top.

There is a third line which is actually now stronger than PUK. That is Gorran and its leader is Nawshirwan. He is also seen as a great leader since he was a powerful leader during the uprising against Saddam.

Well you know that poltiics better, I know Gorran by name but nothing more about him so can’t say anything about that.

 

[Bahoz]

Well, I can't really say too much about it. It is a fairly new party. But it has contributed a lot to the fight against corruption and to improve democracy in KRG.

Do not get my wrong. I generally think that democracy needs to improve in all of Iraq including KRG. Actually in all of Middle East. I do believe that if KRG and Iraq could co operate on a new and improved democratic constitution and relations, the two could become a role model for the region.

 

[Doritos11]

Well, I can't really say too much about it. It is a fairly new party. But it has contributed a lot to the fight against corruption and to improve democracy in KRG.

Do not get my wrong. I generally think that democracy needs to improve in all of Iraq including KRG. Actually in all of Middle East. I do believe that if KRG and Iraq could co operate on a new and improved democratic constitution and relations, the two could become a role model for the region.

Besides the fantasy of the 2 becoming a role model and co-operating, I have heard it before it will not work.
Currently Iraq is providing a lot of money to KRG while KRG is adding nothing to Iraq, << said by Barzani himself. The 2 are enemies, everywhere where Iraq’s PM is visiting ( Russia for weapons, Turkey lately to imrpove relations, Washtington a few days ago. Everywhere where Iraq goes Barzani flies right after trying to stall the deal with Russia, trying to stall the F16 deal and now again he is going trying to stall a new deal, you wouldn’t call this guy an enemy ?

Turkey is just using KRG for economic gain but even KRG and Turkey are actually enemies as KRG’s ideology involves separatism of Turkey.
The enemies of the Iranian gov are the friends of Kurds, the enemies of Turkey, Iraq, Syria.. same applies. No wonder you support PKK, it is the only way for your ideology, you know the idea of Iraq and Kurdish region being friends is a dream since KRG keeps disputing Iraqi land, they aren’t working towards friendship but dreaming about annexing more land. Problems lie ahead, maybe war.

 

[Yzd Khalifa]

If that is going to benefit Turkey then yay!

Just don't try to buy much Turks, we always can give you a discount ..

 

[xenon54 out]

If that is going to benefit Turkey then yay!

Just don't try to buy much Turks, we always can give you a discount ..

Well, a stable KRG is important for Turkey, we cant need a another lawless region on our border.

Its also important to have good relations with KRG, it can help us to solve our problems with Kurds but thats difficult because Iraq would see this as a attack to their national integrity.
I think it would be helpfull for everyone if KRG and Iraqi central goverment would solve their differences, also Iraq could sell its oil through KRG and Turkey to Europe, maybe a link to Nabucco?