IRAQ: Prime Minister Nuri al-Maliki threatens to cut Kurdistan's share of the federal budget if the autonomous region exports oil to Turkey via a new pipeline without central government consent

Record ID: 344373

  • Title: IRAQ: Prime Minister Nuri al-Maliki threatens to cut Kurdistan's share of the federal budget if the autonomous region exports oil to Turkey via a new pipeline without central government consent
  • Date: 12th January 2014
  • Summary: BAGHDAD, IRAQ (JANUARY 12, 2014) (REUTERS) **CONTAINS FLASH PHOTOGRAPHY** IRAQI PRIME MINISTER NURI AL-MALIKI SEATED DURING INTERVIEW IRAQI FLAG (SOUNDBITE) (Arabic) IRAQI PRIME MINISTER, NURI AL-MALIKI, SAYING "We will never allow Iraqi oil to be exported except through the Ministry of Oil or through SOMO (State Organisation for Marketing OIL). This is a constitutional violation which we will never allow, not for the (Kurdistan) region nor for the Turkish government. We have measures to adopt. Iraq's oil is for Iraqis and the region produces 17 percent of Iraq's oil and it has to deliver the region's oil to the central government. Turkey must not interfere in an issue that harms Iraqi sovereignty, which is Iraq's wealth" MALIKI SEATED DURING INTERVIEW (SOUNDBITE) (Arabic) IRAQI PRIME MINISTER, NURI AL-MALIKI, SAYING "According to the budget the region has to export a quota of oil, and if it failed to do that, its share would be cut. We did not do that as we did not want to affect the Kurdish people and we were looking to find acceptable solutions that would preserve national unity and the national wealth, but this year the situation looks difficult" MALIKI DURING INTERVIEW (SOUNDBITE) (Arabic) IRAQI PRIME MINISTER NURI AL-MALIKI, SAYING: "We have been telling these companies, give us the oil and we will pay your costs, but they did not deliver, so there will be no payments. They (the Kurds) want us to pay the those costs and give them 17 percent (of Iraq's oil ) and they do not deliver oil to us. Such a division would be most unfair." MALIKI DURING INTERVIEW
  • Embargoed: 27th January 2014 12:00
  • Keywords:
  • Location: Iraq
  • Country: Iraq
  • Topics: Politics,Energy
  • Reuters ID: LVA2RBVFC58WZMFTG35VW88Z1F28
  • Story Text: Iraqi Prime Minister Nuri al-Maliki threatened on Sunday (January 12) to cut central government funding for Iraq's autonomous Kurdistan region if the Kurds pursued a drive to pipe oil exports to Turkey without Baghdad's approval.
    The Kurdistan Regional Government said last week that crude had begun to flow to Turkey and exports were expected to start at the end of this month and then rise in February and March
    "This is a constitutional violation which we will never allow, not for the (Kurdistan) region nor for the Turkish government," Maliki told Reuters in an interview.
    He reiterated Baghdad's insistence that only the central government has the authority to manage Iraq's energy resources.

    "Turkey must not interfere in an issue that harms Iraqi sovereignty," Maliki said.
    The central government and the Kurds differ over how to interpret the constitution's references to oil and how revenues should be shared. The Kurdish share was set at 17 percent after the U.S.-led invasion in 2003, although the Kurds frequently complain that they get less than that.
    Maliki said the Kurds had not met their budgeted commitment to export 250,000 barrels per day of oil, with the revenue going to the national treasury, but that so far the government had not retaliated by reducing their share of the budget.

    "We did not do that as we did not want to affect the Kurdish people and we were looking to find acceptable solutions that would preserve national unity and the national wealth, but this year the situation looks difficult," Maliki declared.
    Referring to a dispute over the costs of oil companies operating in Iraqi Kurdistan, he said: "We have been telling these companies, give us the oil and we will pay your costs, but they did not deliver."
    Maliki said it was unfair to expect Baghdad to pay the oil firms' costs, plus the Kurds' 17 percent budget share, when the oil revenue was not being channelled through the government.
    In October 2012, the Kurds agreed to export an average of 250,000 barrels per day in 2013 if Baghdad paid the costs of the operators in the region. As the wrangling went on, the Kurds stopped pumping oil via the Baghdad-controlled pipeline to Turkey, instead exporting smaller quantities by truck and taking the revenue directly before laying their own independent pipeline, which was completed in late 2013.
    Iraqi Kurdistan has prospered over the past decade, largely escaping the violence unleashed in the rest of the country after the U.S. invasion that toppled Saddam Hussein.
    Kurdish leaders say they prefer the region to remain part of a federal Iraq, rather than seeking secession, but oil is a highly sensitive issue in volatile relations with Baghdad.
    Companies that have risked exploring for oil in Iraqi Kurdistan had welcomed its plans to pipe oil to Turkey as a signal they might begin to generate export income from their investments, despite Baghdad's objections.
  • Copyright Holder: REUTERS
  • Copyright Notice: (c) Copyright Thomson Reuters 2014. Open For Restrictions - http://about.reuters.com/fulllegal.asp
  • Usage Terms/Restrictions: None
Register