
ANKARA,— Turkey is not prepared to extend the current Iraq’s Kirkuk-Ceyhan oil pipeline agreement under existing terms, a senior Turkish official said after Iraq requested that the arrangement remain in place for at least another year while negotiations continue, Reuters reported.
The Turkey-Iraq Crude Oil Pipeline Agreement, which has governed exports through the pipeline for decades, is scheduled to expire on July 27.
Officials from Baghdad and Ankara are continuing discussions on a proposed replacement agreement.
Responding to Iraq’s request, the Turkish official, who spoke on condition of anonymity, said there was no reason to prolong an agreement that had already become the subject of arbitration proceedings.
The Ceyhan terminal remains an important route for Iraqi crude exports.
Its significance has increased as Iraq’s primary export facility in Basra has been affected by the closure of the Strait of Hormuz following U.S.-Israeli strikes on Iran in late February.
Turkey announced last year that the existing pipeline accord would end and sought to negotiate a new arrangement with revised conditions.
Among the proposals put forward by Ankara were measures designed to ensure fuller use of the pipeline and potential projects, including extending the line farther south within Iraq.
The pipeline had been inactive for two and a half years after an arbitration court ordered Ankara to pay $1.5 billion in damages linked to unauthorized Iraqi oil exports received by Turkey between 2014 and 2018. Oil flows resumed late last year.
A separate arbitration case covering the period from 2018 onward remains ongoing. In addition, an award enforcement case is currently being heard in a U.S. court.
Although the pipeline can transport nearly 1.5 million barrels of oil per day, security concerns and other factors have kept operations well below that level.
Reuters reviewed shipping data showing exports from Kirkuk to Turkey averaged 177,000 barrels per day in April.
(With files from Reuters)
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