Baghdad to bypass Iraqi Kurdistan with oil exports

A worker walks at Nahr Bin Umar oil field, north of Basra, Iraq, in this December 21, 2015 file photo. (REUTERS)

BAGHDAD: Baghdad on Tuesday began rehabilitating the oil pipeline to Turkey鈥檚 Ceyhan port that bypasses Iraqi Kurdistan, after a suspension of nearly three years, the Iraqi oil minister and lawmakers said.
The 970-km-long pipeline, which extends from the northern city of Kirkuk to Ceyhan, is Iraq鈥檚 second-largest, crossing Salahuddin and Mosul provinces.
Exports through the pipeline were suspended in June 2014 when Daesh overran the two provinces.
Resuming oil exports while bypassing Iraqi Kurdistan is the latest in a series of economic sanctions by Baghdad against the Kurdistan Regional Government (KRG), which held a referendum on independence last month.
鈥淎fter the liberation of Nineveh, Salahuddin and Hawija鈥� from Daesh, 鈥渁 major campaign to repair the pipeline has been launched by the Oil Ministry to resume exports,鈥� ministry spokesman Assam Jihad told Arab News.
Iraq used to export between 250,000 and 400,000 barrels per day through the pipeline, mainly from Kirkuk鈥檚 oilfields.
Following Daesh鈥檚 advances, a replacement pipeline was built to link Kirkuk鈥檚 oilfields to Ceyhan via Iraqi Kurdistan.
鈥淭he rehabilitation of the (original) pipeline is a priority for the Oil Ministry to resume exports and boost income for the federal Iraqi budget,鈥� Jihad said.
A deal between Baghdad and the KRG to export 550,000 barrels per day via the replacement pipeline was approved by the federal Parliament in December 2014 鈥� 400,000 barrels from Kirkuk and the rest from oilfields in Kurdistan.
In return, the KRG was supposed to hand the revenues to the state oil company for the federal budget. But Baghdad has not received any revenues.
鈥淭he Kurds totally took control over both the export process and getting back the revenues,鈥� a senior federal oil official told Arab News on condition of anonymity.
鈥淲e have no idea how much they鈥檙e exporting. For the last three years, they kept refusing to give us any information about exports, and to hand over the revenues.鈥�
The federal parliamentary oil and gas committee is backing Baghdad. 鈥淐ontrolling oil and gas resources are exclusive responsibilities of the federal government, and exports by any other side are legally recognized as smuggling,鈥� committee member Awad Al-Awadi told Arab News.
鈥淭he federal government has to gain back control over oil exports as they belong to all Iraqis. No one has the right to control them but the federal government.鈥� The pipeline will be repaired in no more than three months, Al-Awadi said.
Baghdad says revenues from oil exported by the KRG goes directly to bank accounts in a neighboring country that are registered in the names of Kurdish leaders.
Meanwhile, Prime Minister Haider Al-Abadi said in his weekly press conference that Iraqi oil is for all Iraqis and not for a limited number of (Kurdish) officials who put the money (revenues) in their bank accounts.鈥�
He added: 鈥淭his money has to go to the people鈥� we allocate money from (the oil revenues) to pay the employees in Kurdistan.鈥�