UPDATED OCTOBER 2012: “KRG Offers New Details on Planned Pipeline“
Talk of a new pipeline connecting oil fields in Kurdistan to the Turkish port of Ceyhan has only deepened Iraq’s political crisis. Baghdad insists the deal is illegal, since it was reached without the input of the central government, while officials from Irbil and Ankara speak optimistically about a new era of prosperity. I wrote about this pipeline deal last month for the Middle East Policy Council. Last week, Robert Hatem’s guest post talked more about the politics driving Turkey and Kurdistan closer together.
But a major question still looms. Is there really a new pipeline in the works? This is a significant question since every barrel of additional export capacity gives the Kurdistan Regional Government (KRG) more leverage over Baghdad. Unfortunately, the reporting has been muddled so far. Official statements don’t clarify the situation much, either. And I don’t believe there’s any agreement in print yet. So here at Al Ajnabee, I want to sort it out and see if readers can offer new comments, evidence, or conclusions.
As far as I can tell, when we talk about expanding Kurdistan’s oil exports, we’re talking about two separate projects. One is real and plausible; the other is still imaginary. The first–and plausible–project is a pipeline renovation project that will re-open the 46” pipeline connecting Kirkuk to Ceyhan. The Kirkuk-Ceyhan pipeline is actually composed of two lines. One is 46” with a capacity of 1 million b/d. It’s been shut down since 1990. The other is 40” with a capacity of 500,000-600,000 b/d. It currently operates at a diminished capacity of about 300,000 b/d. Renovating the 46” line would allow Kurdistan to pump 1 million b/d through Turkey to the Mediterranean Sea. It could be completed as soon as next year.
The second project, which made the most headlines last month, is a genuinely new pipeline, the contract for which will not be awarded until August 2013, Kurdish Energy Minister Ashti Hawrami says. It’s supposed to carry 1 million b/d but may be years away. The Turks, however, have yet to give this project even a wink or a nod. In public statements, they emphasize the renovation project. Since a new pipeline would stretch hundreds of kilometers through Turkish territory, Ankara’s silence is very, very telling, I think.
Some reports give the impression that this new line is actually a third leg of the twin pipelines that have connected Kirkuk and Ceyhan since the early 1970s. Building a brand new pipeline across international borders would be a brash move by Irbil and Ankara since Baghdad was not part of the deal. But statements from the Turkish Energy Minister, Taner Yildiz, and Kurdistan’s Energy Minister, Ashti Hawrami, suggest there is no new pipeline being readied that would cross the border.
At a May 20 energy conference in Irbil, Turkish Energy Minister Taner Yildiz told the audience that Turkey wanted to see existing pipelines operating at max capacity. He never mentioned a new pipeline. And on June 5, Reuters quoted Kurdish Energy Minister Hawrami speaking at the World Economic Forum in Istanbul. According to the report, “Hawrami said his administration wants the private sector to build a new pipeline link that would solely carry the heavy crude extracted from Kurdish fields within two years [emphasis added].” Since there’s no way a new 600-mile (970km) pipeline could be built connecting Kirkuk to Ceyhan in two years–I think we have to assume this “new” pipeline is nothing more than a short one connecting fields to the existing twin pipelines.
Hawrami said as much. “This is not an alternative to Kirkuk-Ceyhan, but additional capacity, and it is not really a pipeline to bypass current infrastructure,” he told the forum. I can’t find a complete transcript of his remarks. But I’m now inclined to believe the “new” pipeline connecting Turkey and Kurdistan is really 42 years old. Renovations on the 46” line will still rub Baghdad raw, of course, but it seems this development is not quite as bold as some claimed. Kurdish officials are still signaling that they want to be part of Iraq. And, although some in Kurdistan are busy calculating how much money the KRG could make by exporting more oil in the coming decade, Hawrami insists the Kurds will take their cut but pass along most of the revenues to the central government in Baghdad.