ANKARA: Iraq’s northern oil export route via Turkiye will soon be ready to resume operations after pipeline maintenance checks and flood damage repairs, Turkey’s energy minister said on Friday.
The exploration of the pipeline is completed and it will soon be “technically” ready for operation, Alparslan Bayraktar said.
After an International Chamber of Commerce (ICC) arbitration decision ordered Ankara to compensate Baghdad for illegal exports by the Kurdistan Regional Government (KRG) between 2014 and 2018, Turkiye suspended flows on Iraq’s oil export route on March 25, according to Arab News.
Turkiye then began maintenance work on the pipeline, which runs through a seismically active zone, which it said had been damaged by the floods.
“As of today, an independent inspector has completed the survey and they are now preparing a report,” Bayraktar said, without specifying a date for the resumption of oil flows.
Iraq and Turkey earlier agreed to wait until maintenance work was completed before restarting the pipeline, which contributes about 0.5 percent of global oil supply. Sources said oil flows are not expected to start until October, with the KRG losing about $4 billion in lost exports.
Turkiye also calculates that Iraq owes $950 million as a result of the ICC arbitration, after deducting the damages that Turkiye must pay to Iraq.
Turkiye’s expected request
Ankara will also file a request for a “postponed case” with the Paris court, Bayraktar said.
Iraq launched legal proceedings against Turkey in US federal court in April to seek a $1.5 billion arbitration award.
“As two neighboring countries, we must find an amicable solution. But in terms of legality, we have to look after our interests. We will most likely face further litigation in the future. But the gas pipeline will be technically functional. It is more or less ready and we will start operations soon,” said Bayraktar.
Ankara wants Baghdad to drop a second arbitration case covering the period from 2018 and negotiate a lower payment.
Turkiye also wants Irbil and Baghdad to agree on a common position and negotiate a continuation of the pipeline deal, which is due to expire in 2026.
