By Isabel Coles
ARBIL, Iraq Nov 8 A new Turkish oil company is
in negotiations to acquire several blocks in Iraqi Kurdistan in
a joint venture with at least one foreign oil major and the
Kurdistan Regional Government, industry sources said on
If successful, talks by the unnamed Turkish entity would be
another victory for autonomous Iraqi Kurdistan after it signed
deals with oil majors like Exxon Mobil and Total
, defying the central government in Baghdad which says
only it has the right to sign contracts for Iraq's oil
"It has been in the works since the start of the year," said
one industry source with knowledge of the talks.
Kurdistan says its right to sign oil deals is enshrined in
the constitution. But Baghdad says those agreements are illegal
and has warned companies they will be blacklisted from Iraq oil
opportunities if they sign accords with Kurdistan.
Oil majors see better terms, security and an easier working
environment in Kurdistan compared to tougher service contracts
and difficulties with red tape, bureaucracy, and infrastructure
bottlenecks that hit oil projects In the rest of Iraq.
An adviser to the Kurdistan Regional Government's oil
minister declined comment.
While the name of the new Turkish entity was not immediately
clear, one source described it as "state-owned" or a
"state-sponsored" private entity that is negotiating to join
Exxon Mobil's blocks in Kurdistan.
Turkey's state-owned TPAO oil company operates in southern
Iraq but does not have any official operations in Kurdistan.
News of the talks came a day after Iraq said Exxon had
informed Baghdad of its intention to leave a huge oilfield in
the south and officials announced a cabinet decision to reject
TPAO as a partner in another oil project.
Iraqi officials said the Turkish decision was not linked to
any move by TPAO into the Kurdish region. But one Turkish source
said the move appeared political as tensions are high between
Baghdad and Ankara.
TPAO has minority stakes in the two small oilfields of Badra
and Maysan in the south and is running two gas fields along with
Kuwait Energy in the province of Diyala and the southern oil hub
of Basra, both near Iraq's borders with Iran.
The expulsion of TPAO comes amid squabbling between Baghdad
and Ankara after Turkey accused Iraqi Prime Minister Nuri
al-Maliki of sidelining Sunni Muslims in Iraq since the onset of
a political crisis after U.S. troops left in December last year.
Maliki, a Shi'ite close to Iran, has traded insults with
Turkey's Prime Minister Tayyip Erdogan several times, with the
Iraqi leader calling Turkey a hostile state and Erdogan accusing
Maliki of fanning sectarian tensions.
Exxon was the first major to sign up with Kurdistan and is
now at the heart of a long-running dispute over oil reserves and
territory between the Arab-led central government and ethnic
Kurds, who have run their own regional administration in
northern Iraq since 1991.