ERBIL, Kurdistan Region - A tanker carrying crude oil from Iraqi Kurdistan has been permitted to unload its cargo near the Port of Galveston, in Texas, despite threats from Baghdad to sue anyone who buys Kurdish oil.
The docking of the ship in the US port marked not only the first arrival of Kurdish crude oil to the United States but an important victory for the Kurdistan Regional Government (KRG), which has faced challenges in finding buyers for its disputed crude oil.
Andy Kendrick, a Coast Guard petty officer, was quoted as saying the tanker was to pass inspection and then would be ready for offloading. He added that the US National Security Council, State and Homeland Security departments were informed of the arrival and status of the vessel.
Coast Guard officials went aboard the United Kalavrvta tanker on Sunday and verified the ship and crew's ability to safely offload the oil, Kendrick told the Reuters news agency.
Crude offloading was to begin as soon as the ship arranged a contract with a company that performs lightering, the process of offloading that can take between several hours to days, depending on the size of the cargo.
A State Department official, speaking on condition of anonymity on Sunday because of the sensitivity of the issue, said officials were well aware of the ship's location and cargo.
"This is a private commercial matter," the official said. "Our policy has not changed. Iraq's energy resources belong to all of the Iraqi people. As in many cases involving legal disputes, the United States informs the parties of the dispute and recommends they make their own decision with advice of counsel."
Iraq’s Oil Ministry has threatened to sue anyone who purchases oil from the Kurdistan Region after the KRG struck deals to sell crude oil via Turkey without first receiving Baghdad’s approval. The KRG has accused Baghdad of using bullying tactics to stop its oil sales and maintains that it will only keep the 17 percent share of the oil revenue sales, in line with the Iraqi constitution.
"The government of Iraq will reserve the right to sue any company, refinery or trader that buys the Iraqi crude that KRG is illegally offering," an official from Baghdad's state oil marketer SOMO told Reuters on Thursday.
"Our foreign legal team is watching closely the movement of the vessel and is ready to target any potential buyer regardless of their nationality."
The United States has warned against purchasing crude oil from Iraqi Kurdistan because of the potential legal implications from Baghdad. The United Leadership tanker carrying Kurdish crude appeared to be bound for the US in June but ended up in Morocco.
Marie Harf, deputy spokesperson for the State Department, told Rudaw that the State Department does not necessarily deem sales of crude oil from Iraqi Kurdistan illegal, but “there’s a legal dispute process here, an arbitration mechanism. There will be a legal ruling on it.”
Reuters reported that the ship is carrying approximately 1 million barrels of crude, at a value of about $100 million in the current market. The news agency reported that a crude tanker of Kurdish oil landed in Israel and was offloaded in late June, a claim the KRG denies.
Landing crude in the US is a feat for Iraqi Kurdistan, which is trying to establish its own oil trade and is in dire need of revenue since Baghdad cut the region’s funding in January.
