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Rudaw

Kurdistan

Iraqi Kurdistan Region: How to Secure Both Baghdad and Ankara?

26/3/2013
An oil worker at Tawker oil refinery near the city of Zakho, Kurdistan Region. Photo: AP
An oil worker at Tawker oil refinery near the city of Zakho, Kurdistan Region. Photo: AP

By HOSHMAND OTHMAN

The United States has conveyed to Ankara its concern about Turkey's oil companies' direct involvement in Iraqi Kurdistan Federal Region, raising Washington’s fear that the close tie between Ankara and the Iraqi Kurdistan regional capital, Erbil, could further push Baghdad towards Tehran or even lead to the partition of Iraq, Turkish media reported early January.

Although it is not clear how serious is the US warning, the recently announced project of linking Iraqi Kurdistan's oil and gas fields to Turkey and to the world market, through a network of pipeline to be completed by 2016, seems to be at the centre of the US concern.

If implemented, this project would mark a turning point in the growing cooperation between Turkey and the Kurdistan Regional Government (KRG) in the field of energy, and will undeniably have significant geopolitical repercussions.

Turkish new regional role

In order to meet its growing ambitions to become a leading regional economic and political power, Turkey needs Iraqi Kurdistan's natural resources, as one of its major tools.

Turkey depends on imports for over 90 percent of its oil and natural gas. According to a Turkish foreign ministry paper published in 2012, by the Washington-based Centre for Strategic Studies, in about 130 million barrels of crude oil, which Turkey imported in 2011, close to 90 million barrels came from Russia and Iran. The same report indicates that Turkey’s principal energy demand is expected to rise by four percent per year until 2020.

  Kurdistan's current political stability and security could become crucial for countries, which see this Region as a significant source of their energy security, including Turkey.  


Kurdistan Region's oil and gas can significantly reduce Turkish energy reliance on its main suppliers, help diversify its energy sources and boost its domestic economy and its new growing regional policy.

Furthermore, with the two competing planned gas pipeline networks, Nabucco and South Stream projects, due to connect Caucasus and Russia's gas fields to Europe through Turkish territory and its maritime pathway, Turkey has become the unavoidable zone for a significant part of Europe's energy supply. Turkish new target seems to be including the Kurdish oil and gas pipeline as its third network of energy supply to the international market.

Such situation would also put Turkey in a strong position towards Europe, which currently witnesses a decline in its economic growth.

The 45 billion barrels which the KRG estimates as its oil reserves, and more than 100 trillion cubic feet of natural gas, have not left international oil companies and Western countries indifferent. Since the ratification of Iraq's new Constitution in 2005, recognizing the Iraqi Kurdistan self-administered region as a federal entity, the KRG has signed exploration contracts with several international oil companies, including giants such as Exxon Mobil, Chevron, Total and Gasprom.

Kurdistan's current political stability and security could become crucial for countries, which see this Region as a significant source of their energy security, including Turkey.

The rapprochement between Iraqi Kurdistan and Turkey, which, seemingly, has a new political vision for the region, recognizing the Iraqi Kurdish entity, and an important political openness towards its own Kurds, is a significant geopolitical development.

Turkey also plays an important role in the events in Syria, by supporting anti-Assad opposition forces and seeking to have a say in the future of this country. It has positioned itself in the same line as the Arab Sunni states aiming to reduce Shiite regional influence.

If the efforts to connect Kurdistan Region's oil and gas fields to Turkey, and from there to the world market, were crowned with success, it could consolidate Kurdistan Region's autonomy vis-à-vis Baghdad, and boost its economic development.

However, for the Kurds, this adventure with Turkey needs a solid political and economic alternative as backup in case of failure.

  However, for the Kurds, this adventure with Turkey needs a solid political and economic alternative as backup in case of failure. 


Iraq’s internal dynamics

This backup can come from Iraq itself.

The geopolitical conjuncture of the Kurdish issue in Iraq offers a better opportunity today than in the past century to secure alternatives in the event that any alliance with any neighbouring country, fails - in comparison to 1975 when the Shah of Iran broke his alliance with Iraqi Kurds, resulting in an immediate collapse of the Kurdish movement.

Today, more than seventy percent of Iraqi Kurdistan is recognized as a self-governing federal region by the Iraqi federal Constitution. It is the first time that Iraqi Kurdistan obtains such legal status, where a local parliament and government run the Region.

However, the ongoing tension between Baghdad and Kurdistan over the constitutionality of KRG’s contracts with international oil companies and over the disputed Kurdish areas, Arabized by the former Iraqi regime, has been continuing since 2006 with successive governments in Baghdad.

Baghdad considers KRG's unilateral deals with international oil companies illegal and has recently warned the Kurds against any attempt to export oil.

The KRG says the contracts are legal, based on the fact that the Iraqi federal Constitution "gives primacy to regional law except in areas listed under the exclusive powers of the federal authorities. Oil and gas are not listed under the exclusive powers of the federal government. All oil contracts in the Region fall within the KRG oil and gas law, debated and passed by the Kurdistan parliament in 2007 and fully in line with the relevant provisions of the permanent Constitution", the KRG stated on its website last January.

So far Iraq has not made any counter legal argument to explain how KRG contracts with international oil companies are unconstitutional.

The tensions seem to be more politically motivated than being a legal and constitutional issue. No matter who is prime minister in Baghdad, this state of instability may well continue and escalate furthermore, unless a new foundation for a new political and economic partnership is agreed between Iraq’s major political components, taking into account Kurdistan's growing political and economic reality.

In an editorial published last December, the Baghdad-based newspaper, Al Sabah, proposed that while continual dialogue to settle the current problems between Baghdad and Erbil has not produced any permanent settlement, the only solution might be Kurdistan becoming an independent state. The importance of this proposal comes from the fact that Al Sabah is the mouthpiece of the Iraqi Prime Minister, Nuri al-Maliki.

  There is no reason for the United States to be concerned that the Kurdish-Turkish pipeline project could push Baghdad further towards Teheran.  


Whatever is the newspaper’s insinuation, Iraq's border dismantling at this stage could provoke unknown repercussions at a time when the political outcome of the Arab Spring conflicts is still not visible.

A confederation of independent entities

However, a confederation of equally independent entities within Iraq could introduce a medium, if not, long-term regional equilibrium, that can progressively make Iraq stable. This confederal status can go as far as granting Kurdistan the right to export oil and gas, control its air space and recognition of its international representations, among others.

KRG may be able to negotiate this status with Baghdad by becoming one of the major contributors to Iraq’s economy. Kurdistan can sell oil and gas at a special price to Iraq to export to Asian markets through the Gulf.

The foundation of this mechanism is actually already in place. According to an agreement reached between Baghdad and Erbil in 2011, and amended last September, the Iraqi government agreed to market between 175,000 to 200,000 barrels per day of crude oil produced in Kurdistan by international oil companies.

In addition, Kurdistan Region’s reserves in oil and gas can ensure its production capacity to more than two million barrels per day within three to four years. This amount is equal to two thirds of Iraq’s current production capacity of three million barrels per day.

While its confederal status could allow exporting oil and gas legally and independently to Turkey, and keep a close tie with this country, Kurdistan could at the same time enjoy a solid position inside Iraq.

Thus, securing both Baghdad and Ankara can provide political and economic security to Iraqi Kurds in case of failure of their alliance with Turkey or Iraq; and bring about a united confederation.

The first measure to take in this direction would be launching a trust-building process between Baghdad and Erbil to negotiate and settle the immediate outstanding issues: oil contracts and the disputed areas, under the auspices of the international community, above all the United States.

There is no reason for the United States to be concerned that the Kurdish-Turkish pipeline project could push Baghdad further towards Teheran.

Baghdad's refusal to abide by those Articles of the Constitution, which propose settlement for the outstanding issues, is one of the main reasons which have widen the gap between Baghdad and Erbil and, consequently, pushed the Kurdistan Region to get closer to Turkey.

  Kurdistan can sell oil and gas at a special price to Iraq to export to Asian markets through the Gulf.


Regarding US fears that a close Kurdish-Turkish tie may lead to the partition of Iraq, it is to underline that a geopolitical settlement of establishing a confederation of independent entities in Iraq can bring about a united country and long-term regional equilibrium and stability.

Given the current Kurdistan Region’s political and economic development, such confederation remains the only viable solution to keep Iraq together.

Ten years after the fall of Saddam Hussein’s regime, the time has come for the United States to broker a permanent settlement of Iraq’s outstanding issues.

The time when many in the West believed that the only way to achieve stability was for a strong leader to keep the country and its people together with an iron fist, is, in principle, over. The Arab Spring has shown how devastating was that approach.

* Hoshmand Othman MA in Middle Eastern history and politics, EHESS, Paris, France.

 

Comments

 
Christiane | 27/3/2013
Very good in-depth analysis and solid arguments.
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