Exclusive: Iraq hires legal firm to pursue buyers of Kurdish oil

The Iraqi government has tasked a law firm with targeting the buyers of the crude oil ‘illegally’ exported from the country’s semi-autonomous Kurdistan region to neighboring Turkey.

A senior Iraqi official, speaking on condition of anonymity, said the country’s Oil Ministry had instructed the law firm, Vinson and Elkins, some two months ago to pursue those who buy the crude exported from the Kurdistan region to Turkey’s port city of Ceyhan, Reuters reported.

“This is not a game. Anyone who buys this oil is doing something illegal,” said the official, adding, “We will target the companies because they are the ones who will monetize and pay for the Kurdish oil. How else can it get onto the market?”

In early January, Turkish Energy Minister Taner Yildiz said Iraq’s Kurdistan had started flowing crude oil to neighboring Turkey, despite Baghdad’s criticism of the energy exports.

The Turkish minister said the crude was being pumped via a new pipeline to Turkey’s Mediterranean port of Ceyhan, adding that oil flows through the pipeline would start at 300,000 barrels per day (bpd) and rise to 400,000.

Erbil and Ankara have recently signed a multi-billion-dollar energy package. Under the deal, Kurdistan’s oil can reach Turkey and the global markets via the Mediterranean Sea.

The Kurdistan-Turkey agreement has infuriated Baghdad which claims sole authority over Iraqi oil exports. However, the Kurdish Regional Government (KRG) says it has the right to sell the semi-autonomous region’s oil independently.

On January 12, Baghdad summoned Turkey’s chargé d’affaires, Efe Ceylan, over Iraqi Kurdistan’s selling of oil to Turkey without Baghdad’s approval.

Iraq’s Deputy Prime Minister for Energy Affairs Hussain al-Shahristani said after a meeting with the Turkish diplomat that “Iraq considers the export of oil through its international borders without government approval as a violation.”

Iraqi Prime Minister Nouri al-Maliki said on the same day that Erbil’s crude exports to Turkey are a “constitutional violation which we will never allow, not for the (Kurdistan) region, nor for the Turkish government.”