Iraq restarts Kurdistan-Türkiye oil pipeline after 2.5 years in landmark deal
BAGHDAD, Sept 27 — Crude oil flowed on today through a pipeline from the semi-autonomous Kurdistan region in northern Iraq to Turkey for the first time in two-and-a-half years, after an interim deal broke the deadlock, Iraq’s oil ministry said.
The resumption started at 6 a.m. local time (0300 GMT), according to a statement from the ministry.
“Operations started at a rapid pace and with complete smoothness without recording any significant technical problems,” the ministry said.
The agreement between Iraq’s federal government, the Kurdistan regional government (KRG) and foreign oil producers operating in the region will see 180,000 to 190,000 barrels per day of oil flow to Turkey’s Ceyhan, Iraq’s oil minister told Rudaw on Friday.
The U.S. had pushed for a restart, which is expected to eventually bring up to 230,000 barrels per day (bpd) of crude back to international markets at a time when OPEC+ is boosting output to gain market share.
The Kirkuk-Ceyhan pipeline was halted in March 2023 when the International Chamber of Commerce ordered Turkey to pay Iraq $1.5 billion in damages for unauthorised exports by the Kurdish regional authorities.
The preliminary plan, agreed on Wednesday, calls for the KRG to commit to delivering at least 230,000 bpd to Iraq’s state oil marketer SOMO, while keeping an additional 50,000 bpd for local use, according to Iraqi officials with knowledge of the agreement.
An independent trader will handle sales from the Turkish port of Ceyhan using SOMO’s official prices.
For each barrel sold, $16 is to be transferred to an escrow account and distributed proportionally to producers, with the rest of the revenue going to SOMO, the officials said.
Norway’s DNO said it has no immediate plans to export through the pipeline but that its local buyers could still ship its crude through it. The company and its joint venture partner Genel Energy have said the issue of Kurdistan’s around $1 billion in arrears to producers, of which DNO is owed about $300 million, needs to be addressed.
The eight oil companies that signed the deal and the KRG have agreed to meet within 30 days of exports resuming to work on a mechanism for settling the outstanding debts. — Reuters
[Source: Malay Mail]
