Sign In / Up

Add contribution as a guest

Your email will not be displayed publicly
Benefit of signing in/signing up to personalize comment

Comment as a guest

Your email will not be displayed publicly
Benefit of signing in/signing up to personalize comment

Login

Not a member Register   Forgot Password
or connect using
 

Email

 

Rudaw

Kurdistan

Baghdad Rejects Oil Revenues Mechanism Proposed by Turkey

19/11/2013
Iraqi commandos survey Fauqa Oilfield in Maysan province. Photo: AFP
Iraqi commandos survey Fauqa Oilfield in Maysan province. Photo: AFP

By Samia Zuber

ERBIL, Kurdistan Region – Iraqi Prime Minister Nuri al-Maliki’s State of Law Coalition has rejected a Turkish proposal for an escrow account to monitor Iraqi oil revenues and resolve a pending payment issue between Baghdad and Erbil.

“Iraq is a sovereign country and it does not seek counseling from foreign countries for distribution of its revenues,” said Khalid Saadi, an MP from the State of Law Coalition. “Iraq has laws to settle these issues,” he added.

Last Saturday, Turkish Energy Minister Taner Yildiz proposed a mechanism to end the long-standing dispute between Iraq and its autonomous Kurdistan Regional Government (KRG) over the sharing of oil revenues. Yildiz said that he discussed the issue with Iraq’s Deputy Prime Minister for Energy Affairs Hussein Shahristani, but has not yet heard back from him.

“The distribution of the revenues would be carried out by Iraq, we would only hold these deposits at a Turkish state bank," said the Turkish energy minister.

Saadi said that Yildiz’s proposal would only lead to further deterioration of relations between Baghdad and Ankara.

After two years of strained relations over Syria, Sunni populations in Iraq and Kurdistan energy deals with Ankara, Iraq and Turkey mended relations earlier this month through exchange visits by their respective foreign ministers.

The Iraqi parliament has failed to pass the Hydrocarbon Law, which has been languishing since 2007 over disagreements between Kurds, Sunnis and Shiites.

Meanwhile, Farhad Atrushi, a member of the Iraqi parliament’s Oil and Gas Committee, expressed doubt that Baghdad would ever agree to Turkey's proposal. “Article 112 of the Iraqi constitution allows the KRG to run its oil affairs,” he argued.

That article of the Iraqi constitution allows the federal government, in cooperation with the producing regional government and governorates, to manage oil and gas extraction. It also allows the right to distribute revenues “in a fair manner in proportion to the population.”

Atrushi concurred with Saadi that the distribution of Iraqi revenues is an Iraqi internal matter, but believed that other stakeholders should be taken into consideration. “Undoubtedly, this is a domestic matter, but Turkey is still a party in this issue because Kurdistan’s oil pipelines go through Turkey. In addition, the biggest Turkish oil company has investments in Kurdistan’s oil sector,” he said.

Atrushi maintained that the Kurdistan Region should not be treated like another province. “The region has been governing itself for years,” he noted.

The KRG demands that Baghdad pay the fees for international oil companies operating in Kurdistan, which it says amount to $5 billion.

Over such disputes, the KRG has halted exporting some 100,000 barrels per day since December 2012 through Iraqi-Turkish pipeline that are managed by the central government.

Comments

 
Bill Lees | 20/11/2013
Why should Maliki care about obtaining more revenue for all Iraqis? His son has billions of dollars in real estate throughout the Saudi peninsula,and some relly nice Maseratis to drive around London and pick up the girls!They are living large in the Green Zone at times.
Wild Boar | 21/11/2013
This disagreement over oil revenue cannot go on for ever. I think the best course of action is to set up an independent commission with equal members of from Iraq and Kurdistan region to hammer out a proposal which then should be debated by both Iraqi parliament and Kurdistan parliament. If both parliaments agree on the draft or the amended version then it should be made to law.
FAUthman | 21/11/2013
Crrently there may be close to forty oil companies working in Kurdistan under PSC contracts with the KRG. Each will present individual production costs and profit figures for which they require payment. These figures need to be verified and accepted by the KRG alone, or jointly with Baghdad, before payments are made. Working jointly with Baghdad has been tried by Arbil but it has not worked, for Baghdad has continuously disagreed, legitimately or not, with Arbil`s figures. So far $5 billion in bills have accumulated but have not been paid. This is an accounting issue and will continue being a problem but with increasing complexity as more companies demand payment, as long as both Arbil and Baghdad have to agree on the payment figures in the absence of an independent auditor. That is where the U.S. needs to step in and help set up a payments mechanism that is equitable and efficient. The export logistics of oil and gas from Kurdistan and the accounting and disbursement mechanisms have to respond to the unique requirements of the individual PSC contracts made with the KRG.
Russel Check | 22/11/2013
@Wild Boar pointless, everything has been tried with Baghdad, they haven't' honored ONE single agreement, not even the constitution, that means that they will never honor any agreement in the future, it's the same mentality of Saddams era, they think they can dictate everything. I don't think KRG leadership are under any illusions any more, they know who they're dealing with. KRG next move should be to unite ALL anti Malaki factions and kick both him and his lapdog Sharistani from their thrones.
Tags :
Print Email to a friend
Save this story
7402 Views

Be Part of Your Rudaw!

Share your stories, photos and videos with Rudaw, and quite possibly the world.

What You Say

Ian Birmingham | 3/28/2015 8:02:46 PM
USA residents, please use PopVox to tell Congress you support HR 1654! https://www.popvox.com/bills/us/114/hr1654
Dick Dickson | 3/28/2015 8:26:31 PM
Don't give any more arms to the Baghdad government. They'll drop them and run in the face of ISIS. Instead arm the Kurds who know how to use them...
Proposed US bill: recognize Iraq’s Kurds as ‘partners’ and arm them directly
| yesterday at 01:37 | (26)
Mat Ashor | 3/28/2015 8:20:52 PM
Am I supposed to feel sorry for the Mosul residents or something? I thought this is what they wanted!
ISIS demands 'protection tax' from Mosul residents
| 15 hours ago | (1)
Karelian Girl | 3/28/2015 7:53:07 PM
ISIS hae to bestopped now! They have to be hunted down util there is not a single one of the left! They are causing huan suffering on a scale not...
Iraq-UN conference to discuss future of ISIS-held areas
| 11 hours ago | (1)
dolora33 | 3/27/2015 7:28:41 PM
Peshmerga first needs the weapons and ammunition it needs to fight them. They could defeat ISIS completely if the US gives them the weapons directly...
Jeff | 3/28/2015 6:25:30 PM
Obama Middle East Policy: 1) Hate Israel. 2) Don't arm the Kurds. 3) Arm ISIS via Baghdad. 4) Give Iran a Nuke.
Peshmerga close in on ISIS lines in Shingal
| yesterday at 11:49 | (5)

Elsewhere on Rudaw

Has ISIS Made Iran Stronger? 18/3/2015 | (11)

Has ISIS Made Iran Stronger?

Soleimani’s work is currently focused on Iraq more
Jolie opens UK academic center studying women in conflict 11/2/2015 | (4)

Jolie opens UK academic center studying women in conflict

Angelina Jolie has opened an academic center more
What Is Turkey's Future Under Erdogan? 27/1/2015 | (25)

What Is Turkey's Future Under Erdogan?

Where will his worldview take Turkey and the more
0.219 seconds