Last Thursday, a tanker filled with one million barrels of Kurdish oil left the Turkish port of Ceyhan, headed for sale in Europe. The next day, Iraq’s Ministry of Oil (MOO) filed a Request for Arbitration at the Paris-based International Chamber of Commerce against Turkey, claiming a violation of a 1973 Iraq-Turkey Pipeline Agreement. Baghdad claims the MOO must approve any sales via Turkish pipelines, while the Kurdistan Regional Government (KRG) insists the Kurds are acting within their constitutional rights.
The dispute threatens to derail negotiations to form a national government following April’s elections. Rudaw sat down with KRG Minister of Foreign Relations Falah Mustafa in Erbil to discuss what happens next.
Rudaw: Is there any hope for progress with Baghdad-Erbil oil negotiations?
Falah Mustafa: The current (federal) government is a caretaker government. It has not been willing to solve problems, and won’t do so now -- we don’t expect anything now that the elections are over.
Oil is not the only issue. There’s the status of the Peshmarga [Baghdad refuses to pay the budget for Kurdish security forces]. The only part of this country that is safe and stable is Kurdistan, and that is because of the Peshmarga. They have not been treated properly.
The only part of this country that is safe and stable is Kurdistan, and that is because of the Peshmarga. 
Go to the issue of Article 140 in the constitution [which requires a referendum in Kirkuk and other disputed territories, deciding whether they will join the KRG, by December 2007]. These areas that have been unfairly detached from the Kurdistan Region; there has still not been a census or referendum.
The best solution is to go to a confederation, where we move to two or three sovereign states within the boundaries of Iraq so that we can have equal powers and equal rights. That would be only fair considering the suffering and the tragic history of the Kurdish people.
Rudaw: The US has been moderating talks between the KRG and Baghdad to try to resolve the oil dispute. On Friday, the Americans issued a statement that they do not support the sale of oil without the support of the Federal Government. Brett McGurk, US Deputy Assistant Secretary of State for Near Eastern Affairs, Tweeted: “The tendency on all sides to believe unilateral measures build ‘leverage’ in future talks rarely works, and often backfires, badly.” Is the sale of oil “leverage” for negotiations?
Falah Mustafa: We did not do that for bargaining purposes. We have told the whole world that we can’t go on like this. The fact that we did not do this before the elections was because we were still hoping we could reach an agreement. The Americans were online. We tried.
No government in the world can survive six months without salaries, so we had to move. This was the most logical thing to do. We have done nothing wrong, nothing illegal and nothing unconstitutional.
We have done nothing wrong, nothing illegal and nothing unconstitutional.
Rudaw: What is the role of the US in negotiations?
Falah Mustafa: We have considered ourselves as friends and allies of the United States. Not a single American soldier or civilian has been killed in our region. The Americans were welcomed here. We have helped them a great deal in trying to make the political process in Iraq succeed.
Following the liberation of Iraq, certain commitments were made and should have been addressed before the Americans left. When President Obama spoke of a phased and responsible withdrawal, our understanding was that this meant helping Iraq solve certain problems. We said it loud and clear: These problems have to be resolved before Americans go out, because we know the mentality in Baghdad -- the mentality of control, of denial. Arabs see themselves as more important, as higher than the Kurds. And we will not accept that.
We were given promises -- promises that haven’t been carried out. Promises that Article 140 would be solved -- it has not been. Promises about a hydrocarbons law -- this hasn’t passed through parliament. We don’t want promises; we want deeds, actions and deliverables.
We appreciate the US engagement since they came last year. They engaged because they want to help both sides.
We have shown flexibility. KRG Prime Minister Nechirvan Barzani offered an initiative contributing 100,000 barrels per day through the existing mechanism [payments through State Oil Marketing Company (SOMO) accounts in New York]. We hoped Baghdad would respond positively with the payment and would work towards an interim agreement. But they didn’t react.
If there are people who want to help, then they have to be neutral.
Whenever the Americans needed us we were there, we have gone the extra mile. It’s enough. This is an internal issue of Iraq. If there are people who want to help, then they have to be neutral, and they can’t exert pressure on the KRG in order to appease others. We will determine our policies based on the interests of the people of Kurdistan.
It’s been six months that Baghdad hasn’t paid us (the regional budget), and we have not seen any statements aloud in public about this from the US or UK, European countries about that. Why is that? Why, when the KRG does something, people want to talk about that publically? Why is [US State Department spokesperson] Jen Psaki not giving a statement that the Kurdish people deserve their fair share from the budget?
Rudaw: They consider that interfering in the internal affairs of Iraq.
Falah Mustafa: This is also interference in the internal affairs of Iraq.
The KRG is a legitimate entity inside of Iraq -- our actions represent Iraq. The KRG is a recognized entity by the UN, by the international community and by the constitution. Therefore, whatever the KRG does is legal. If we have differences, it’s for us and Baghdad to sort out.
If they are unhappy with this situation, then let us have a divorce, because we are not happy in this relationship. We were almost independent…history has betrayed us. The superpowers have betrayed us, and we were divided against our will into four countries. We were attached to Iraq -- an artificial entity -- in order to keep the balance between Shiites and Sunnis, something which will never be kept. So why should we as Kurds pay the price to keep the balance between these communities?
As a compromise, we agreed to be part of a federal system that ensures power-sharing and wealth-sharing, one where we would have equal representation on the federal level.
If we have differences, it’s for us and Baghdad to sort out.
But no one is adhering to that. Eleven years after the fall of the regime, we still have the problems we faced on the first day. What does that mean? It means there is no political will to find a solution, no commitment to the constitution, no respect for partnership.
Rudaw: Will the current dispute lead to a declaration of independence?
Falah Mustafa: In 2005, the Kurdish people voted in a referendum that was organized by civil society institutions. 97.5 percent of people voted for an independent Kurdish state. Therefore, the Kurdish leadership is under huge pressure to manage the expectations of the people. For Baghdad to come back and ask us to surrender to their will would be impossible.
This is the time when Iraqis can either sort out their differences and establish a federal government following the constitution in the spirit of democracy and pluralism, or the Kurdish people will be obliged to go their own way towards a referendum. Right now, people want a confederation because we cannot continue like this, not to have power on economic or cultural issues.
Baghdad is waging economic warfare against the region so that we will politically surrender. This will not happen. The time has come to make it clear that either Baghdad accepts us as equal partners or we will go in different directions.
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