A Review of the Nigerian Energy Industry

Iraq initiative to ‘resolve export row’

oil barrels09 April 2014, News Wires – Iraq’s oil minister is reported to be confident of reaching a deal “within days” to resolve an export dispute with the Kurdistan region, with Baghdad now working on a second pipeline to boost flows to Ceyhan.

The ongoing spat has halted independent exports by Kurdistan via a new pipeline to the Turkish port, where more than 1 million barrels of crude already pumped along the route are currently lying in storage tanks.

The federal government has blocked the semi-autonomous region’s export bid, saying that state oil marketing body Somo has the sole right to carry out exports, while Ankara is waiting on Iraq’s blessing before allowing oil shipments to begin.

Iraqi Oil Minister Abdul Kareem Luaibi said Iraq’s parliament set up a high-level delegation several days ago to resolve the impasse, according to Reuters.

“The task of this delegation is to secure agreement between the two sides, and I believe they will secure this agreement,” he said at an oil and gas conference in the Turkish capital.

“The parliamentary council will hold talks on this subject within hours, and even if there is no agreement today, I expect an agreement within a couple of days.”

Kurdistan recently restarted limited exports along the federal-controlled Kirkuk-to-Ceyhan pipeline as a gesture of goodwill, after a halt of more than a year due to a related row over Iraq’s refusal to pay foreign producers working in the region, part of a wider dispute over resource sovereignty.

However, flows of 100,000 barrels per day along the route that started last month have again been halted due to militant attacks in several places and a technical problem at a facility in Turkey, Luaibi said.

“We are trying to resolve these problems. I believe flow will resume within one week,” he added.

The minister said Iraq now wants to double oil transport capacity to Ceyhan to more than 1 million barrels per day with the construction of a second pipeline.

“We are building a pipeline in Iraq. I believe the daily oil flow will exceed 1 million barrels a day when that line is completed. I hope it happens this year,” he said.

He was set to discuss the pipeline and other issues with Turkish Energy Minister Taner Yildiz on Wednesday.

Separately, construction of the Trans-Anatolian natural gas pipeline project (Tanap), which will carry Azeri gas to Europe through Turkey, will start in April 2015, Tanap general manager Saltuk Duzyol said.

Tanap aims to start carrying 16 billion cubic metres of gas per year by 2018 or 2019 from Azerbaijan’s Shah Deniz 2 field in the Caspian Sea, one of the world’s largest gas fields.


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