Iraq's government Monday said crude-oil exports from the semi-autonomous northern region of Kurdistan to neighboring Turkey are "illegal" and threatened to take "appropriate action," in a continuation of recent of tensions between the two.
Iraq
's
government Monday said crude-oil exports from the semi-autonomous northern
region of
Kurdistan
to neighboring
Turkey
are
"illegal" and threatened to take "appropriate action," in a
continuation of recent of tensions between the two.
The Kurdistan Regional Government, or KRG, has begun exporting an unspecified
amount crude oil by truck to
Turkey
without
the permission of the central government.
"This is an illegal and unconstitutional business that we will take the
right decision against," Faisal Abdullah, spokesman for
Iraq
's
Deputy Prime Minister for Energy Hussein al-Shahristani, told Dow Jones Newswires.
"The Oil Ministry [in
Baghdad
]
solely reserves the right to export crude oil, gas or oil products to other
countries," Mr. Abdullah said.
Baghdad
and
Erbil
, the
capital of
Iraq
's
Kurdistan
, are
at loggerheads over a number of issues including who should control oil and gas
produced in the region. The central government argues that it should control
all resources in the country, while the Kurds say that they are eligible to run
their own resources in accordance with the country's new constitution.
The Kurds said that its crude would be refined in
Turkey
and
send back for local consumption, and that it was forced into this because the
central government hasn't been sending enough oil products to meet their needs.
The KRG in April suspended crude oil exports of nearly 100,000 barrels a day
through a Baghdad-controlled export pipeline, protesting that the central
government was delaying payment of around $1.5 billion that the region needs to
pay to contracting companies.
This came after the central government reached an agreement that the Kurdish
authorities would resume oil exports from February after a suspension of more
than year, and agreed to pay exploration costs and expenses to foreign firms in
the KRG.
Tensions between Baghdad and the Kurdish region have risen since October, when
U.S. energy giant Exxon Mobil Corp. (XOM) announced a deal with the KRG to
explore for oil in Kurdistan.
Baghdad
warned the
U.S.
oil
giant could risk its agreements with the central government.
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