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Iraqi Kurds ship oil through region's own pipeline

Published on NewsOK Modified: May 23, 2014 at 10:33 am •  Published: May 23, 2014

BAGHDAD (AP) — Iraq's self-ruled northern Kurdish region said Friday that it has made its first oil shipment through its own pipeline to the international market, bypassing the central government in Baghdad, which insists that it has the sole right to develop and market the country's natural resources.

Baghdad's Arab-led government and ethnic Kurds have a long-running dispute over the right to develop and export natural resources, and both rely on different interpretations of Iraq's constitution. Baghdad maintains the Kurdish region's over 50 separate energy deals with Western companies are illegal.

In 2009, the three-province Kurdish region officially started pumping crude oil to the international market through a Baghdad-controlled pipeline that goes through Turkey's Ceyhan Mediterranean port, but shipments were interrupted many times over payment disputes. Last year, the Kurds constructed a separate pipeline and started pumping to separate storage facilities at Ceyhan in January.

More than 1 million barrels were loaded Thursday night in Ceyhan and shipped to Europe, the Kurdish Ministry of Natural Resources said in a statement. It didn't name the buyer or give other details on how the sale completed.

"This is the first of many such sales of oil exported through the newly constructed pipeline in the Kurdistan Region," the statement said.

Baghdad has warned that it will not give the Kurds their 17 percent share in the national budget and will sue the buyers if they go ahead with the exports without central government approval.

Later Friday, Iraq's Oil Ministry filed a request for arbitration with the Paris-based International Chamber of Commerce against the Turkish government and Turkeys' state-run BOTAS company that runs the pipeline, said the ministry's spokesman, Assem Jihad.

Jihad said both violated the 2010 agreement with Iraq that states the state-run oil marketing company, known as SOMO, is the only concerned party to export natural resources.

In Ankara, Turkish Energy Minister Taner Yildiz told reporters that the exact quantity of the exported crude was around 1.05 million barrels and the shipment was headed "probably to Italy and Germany."

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