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Turkey set to reopen pipeline with Iraq

Published by , Editorial Assistant
World Pipelines,

After being suspended for approximately six months, Turkey will be reopening an oil pipeline to Iraq.

Alparslan Bayraktar, Turkey’s Energy Minister, said at the ADIPEC 2023 conference in Abu Dhabi: “Within this week, we will start operating the Iraq–Turkey pipeline after resuming operations. It will be able to supply half a million bbls, almost, to global oil markets.”

In March 2023, Turkey stopped flows through the twin pipeline after the International Chamber of Commerce International Court of Arbitration ordered Ankara to pay around US$1.5 billion (Tl41.16 billion) in damages to Iraq for transporting oil without Baghdad’s approval. Turkey wants the fine to be reduced.

The arbitration case has been running in the Paris-based court for almost nine years with Iraq claiming that Turkey had violated the 1973 pipeline transit agreement by allowing crude from the Kurdish region to be exported without Baghdad’s permission.

Since the ruling, Ankara has started maintenance work on the pipeline, which contributes around 0.5% of global crude supply, as it says the pipeline was damaged by earthquakes in February 2023.

The line provides an important source of revenue for the Kurdistan region and since its closure the Kurdistan Regional Government has been forced to rely on loans to pay public salaries.

Before the closure, the twin pipeline had a capacity of 1.6 million bpd but averaged around 450 000 bpd just before it shut.

It is estimated that Turkey has lost more than US$1 billion worth of revenue since the closure. Turkish authorities believe Iraq is losing far more, however, and Baghdad and Erbil will therefore have a strong motivation to find a solution.

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