KRG Denies Alleged Oil Smuggling to Iran

12 Jul 2010 (Medya News) In response to a weekend news article claiming a rampant black market is sending raw and refined products from Iraqi Kurdistan into Iran via tanker truck, the top Kurdish oil official said there have been no illicit exports of crude.

Below is the KRG statement:

KRG statement on recent New York Times article

11 July 2010

Kurdistan refined products

The Region’s refineries provide essential fuels to Iraqi domestic and international markets. The KRG is proud of its growing oil and gas sector, and the KRG’s free trade policies.

The Kurdistan Regional Government (KRG) has licensed three refineries in the Kurdistan Region. These licenses are issued in accordance with the Iraq Constitution and the Kurdistan Region’s Oil and Gas Law of 2007.

The refineries provide much-needed petroleum products to the people and businesses of the Kurdistan Region. The Kurdistan Region is the economic success story of Iraq.”

Surplus from some refined products from Kurdistan’s refineries is available for export. The KRG conducts open and competitive tendering for the export sale of petroleum products.

Products refined outside Kurdistan

The major sources of refined products are the large refineries in other parts of Iraq including Beiji, near Baghdad, and Dora, in Salahiddeen governorate. Some of that product may well be exported through the Kurdistan Region.

In other parts of Iraq, fuel oil is sold to the local private sector by Federal agencies at a significant discount to the international price. This discount is intended to stimulate the local economy. Unfortunately, this creates incentives for the buyers to engage in cross-border trade.

The KRG is aware of the fact that profiteers in fuel oil refined outside Kurdistan have exploited Kurdistan’s international borders. The KRG, with the active support of President Barzani, is instituting a series of measures to ensure full compliance with the Iraqi Constitution and international law, and in this regard the KRG is committed to working with the Federal Government to eliminate permanently all such profiteering in fuel oil, not only in the KRG but also along the entirety of Iraq’s international borders.

Joint KRG-Federal measures include mandatory licensing of all fuel oil tankers entering the Kurdistan Region.

Crude oil

In 2009, the KRG commenced the export of crude oil by international pipeline through Turkey to the Turkish port of Ceyhan.

With that exception, no crude oil travels across the internal or external boundaries of the Kurdistan Region.

KRG oil policy a success

The KRG’s oil policy, under the guidance of the KRG’s Ministry of Natural Resources, is endorsed by the whole Government and is a resounding success. It will continue to be the engine of the Kurdistan Region’s economic development.

Source: KRG.ORG