Turkey signs oil deal with Kurdistan Regional Government

02 December 2013

Crude oil and gas exports through Turkey to be expanded

The semi-autonomous Kurdistan Regional Government (KRG) of Iraq has signed a raft of agreements with Turkey to allow the export of crude oil and gas directly to its northern neighbour and onto international markets.

KRG Prime Minister, Nechirvan Barzani visited Ankara at the end of November, holding a three-hour meeting with his counterpart, Recep Tayyip Erdogan to discuss cooperation between the two governments.

The agreements include one signed by an as yet unnamed Turkish state-owned firm, which will operate and explore in the Kurdish region, working alongside US oil major ExxonMobil in some areas, according to the Asharq al-Awsat news agency.

Another covers the construction of new crude oil pipeline to lift Kurdish exports to 1 million barrels a day (b/d) by 2015, and a gas pipeline by 2017.

Speaking at a conference in Erbil on 2 December, Minister of Natural Resources, Ashti Hawrami, said the KRG has already completed one oil pipeline, which is ready to carry more than 300,000 b/d. The pipeline connects with the existing Iraq-Turkey oil export pipeline.

Revenues will be deposited into an escrow account in a Turkish government owned bank, which will be used to pay contractors. Payments to the KRG and federal government in Baghdad will be held until a deal can be reached on revenue sharing between the two.

A MEED Subscription...

Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.

Get Notifications