Shafaq News..Kirkuk Governor: Iraq, Turkiye defer $1.47B arbitration payment

Shafaq News- Kirkuk/ Ankara

Iraq and Turkiye have agreed to defer settlement of a $1.471 billion arbitration award against Ankara, with payment through Iraqi crude exports also under consideration, Kirkuk Governor Mohammed Samaan Agha told Shafaq News on Friday.

Agha said he proposed either postponing settlement or offsetting the amount with barrels exported through Turkiye, and both governments approved the proposal. Ankara had previously sought relief from the award, but Baghdad rejected waiving the compensation because of its financial pressures.

An International Chamber of Commerce tribunal on February 13, 2023, ordered Turkiye to pay Iraq a net $1.47139 billion after set-offs, plus applicable interest, over unauthorized Iraqi crude exports through Ceyhan between May 21, 2014 and September 30, 2018. The Paris Court of Appeal on March 10 rejected Turkiye’s attempt to partly set aside the award, while a separate Washington enforcement case continues to address the parties’ claims and accrued interest before determining the final balance.

On August 1, Iraq’s and Turkiye’s state oil and pipeline companies signed a one-year agreement maintaining use of the Iraq-Turkiye Pipeline while negotiations continue over a broader framework, with the interim arrangement covering 750,000 barrels per day of capacity.

Agha said the Kirkuk-Ceyhan route is operating and that work is underway to raise export capacity beyond one million bpd as Kirkuk’s oil fields and infrastructure are developed.

Turkiye’s state-owned TPAO also agreed on July 28 to acquire a 15% stake in BP Energy Company of Kirkuk Limited, joining BP and ConocoPhillips in developing major oil and gas fields in Kirkuk.