TURHAN – Top refinery shies away from Kurdish oil in Ceyhan

Top refinery shies away from Kurdish oil in Ceyhan Turkey’s largest oil refinery, Turkish Petroleum Refineries Corporation (TuPRAI), still does not want to buy Kurdish oil stored at the Mediterranean export hub of Ceyhan, the top company representative told Today’s Zaman on Monday.Mustafa Ko, the chairman of the board at Turkish conglomerate Ko Holding, which also owns TuPRAI, stressed in Barcelona on Monday that the company will avoid any business deal that would worsen a lingering dispute over the sale of Kurdish oil to international markets between the Iraqi central government in Baghdad and the Kurdistan Regional Government (KRG).

The refinery already buys Iraqi Kirkuk crude, which flows through a separate oil pipeline to Ceyhan. The refiner is set to buy 18 million barrels of the Kirkuk oil in July.

A crude oil pipeline between northern Iraq and Turkey was completed late last year, and oil has since been pumped through it into storage tanks at Turkey’s Mediterranean port of Ceyhan. Three separate tankers loaded with Kurdish oil have reached international markets so far with the oil storage tanks in Ceyhan having almost reached full capacity.

Energy market experts comment that Ankara has to act to find more buyers if it wants to capitalize on the stored Kurdish oil and before it runs out of storage capacity. “We do not see any interest in embarking on a new aenture in Iraq which will risk business ties in this country.

Especially amid the current political uncertainty there,” Ko commented on the issue. Ko said his business group is concerned that the current armed conflict stoked by insurgents in Iraq will evolve into a wider crisis for the region.

Amid a search for customers in the global markets to sell the crude stored in Ceyhan, TuPRAI was mentioned among potential domestic buyers however the refinery’s owners have so far avoided being involved in this business, fearing a sever in ties with Baghdad. Ko already has separate investment and trade interests both in Iraq’s north and the Baghdad-controlled South.

Tensions flared between Ankara and Baghdad after Turkey facilitated shipments of oil from the KRG — which is said to have one of the world’s largest untapped oil reserves — through Turkey’s Ceyhan pipeline that bypassed the Iraqi federal government’s control.Earlier in May, Turkish Energy Minister Taner YIldIz disclosed that there are 18 million barrels stored in Turkey, indicating that 100,000 barrels are sent to Turkey on a daily basis.

SOURCE: Today’s Zaman