KRG says ruling against oil exports won’t affect talks with Baghdad

ERBIL, Kurdistan Region - Kurdistan Region’s Ministry of Natural Resources on Saturday said a decision from a court of arbitration against the Region’s independent oil exports will not affect the ongoing talks with the federal government about the oil and gas sector.

The International Chamber of Commerce in Paris on Thursday decided in favour of the Iraqi government against Turkey with respect to the Kurdistan Regional Government’s (KRG) oil exports through Turkey’s Ceyhan port. 

Reacting to the verdict, the KRG’s Ministry of Natural Resources said it will not affect ongoing talks with the federal government, adding that they have reached a preliminary agreement on budget, oil and gas issues with Baghdad and will continue to pursue the matter until a constitutional solution is reached. 

“The French court’s verdict in favour of the Iraqi government against Turkey will not be an obstacle in front of the ties with Baghdad’s government,” reads the ministry’s statement. 

Kurdistan Region Prime Minister Masrour Barzani said a delegation will travel to Baghdad for talks on Sunday. “Our recent understandings with Baghdad have laid the groundwork for us to overcome the arbitration ruling today,” he tweeted.

The arbitration court ruled that Ankara had breached a 1973 pipeline agreement between Iraq and Turkey that obliges the Turkish government to abide by instructions issued by Iraq regarding the transport of crude oil exported from Iraq. In 2014, the KRG began using the pipeline to send its crude to Turkey’s Ceyhan port, to the ire of Baghdad.

Iraq’s oil ministry welcomed the verdict in a statement released earlier on Saturday and said it would engage with the KRG and Turkey about how to proceed with oil exports.

In compliance with the court order, Turkey halted KRG’s oil exports and, according to Reuters, told Baghdad it would wait for permission from Baghdad to continue.

The Kurdish government is heavily reliant on its revenues and an inability to sell its crude will severely affect its already struggling economy. The government has failed for years to pay its over a million civil servants on time and in full.

By Azhi Rasul