INTERVIEW-Turkey seeks deeper energy relationship with Iraq, Kurdistan

ANKARA, April 4 Thu Apr 4, 2013 2:44pm BST

ANKARA, April 4 (Reuters) - Turkey would play an active role in any arrangement in Iraq under which crude oil export revenues are shared between the central government and the northern Iraqi Kurdistan region, Energy Minister Taner Yildiz said on Thursday.

Yildiz told Reuters in an interview Turkey stood ready to support an arrangement under which 83 percent of oil export revenue went to Baghdad and the remaining 17 percent went to the government of the autonomous Kurdistan region.

"There is nothing on this issue that would unsettle the Iraqi central government," Yildiz said.

"Turkey would play an active role in giving the 17 percent to northern Iraq and 83 percent to the Iraqi central government."

Oil lies at the heart of a long-running feud between the central government and the autonomous Kurdistan region. Baghdad says it alone has the authority to control exports and sign contracts, while the Kurds say their right to do so is enshrined in Iraq's federal constitution.

The Kurdistan Regional Government (KRG) started on the path towards economic independence early this year by exporting small volumes of crude oil by truck to Turkey.

The move further angered Baghdad, which threatened action against the region and foreign oil companies working there to stop the exports, which it says are illegal.

Yildiz said he saw no obstacles to public or private firms striking oil exploration deals with Kurdistan, but also said Turkey would take part in oil exploration tenders if invited to do so by the central government in Baghdad.

He said Turkey also stood ready to build a natural gas pipeline in Iraq if requested by either Baghdad or Kurdistan.

Yildiz said Turkey's imports from northern Iraq changed on a daily basis but reached a maximum of around 200-250 road tankers a day. He said Turkey may increase annual oil imports from Iraq as a whole to 4.0 million tonnes from a current 3.5 million.

KRG crude used to be shipped to world markets through a Baghdad-controlled pipeline running from Kirkuk to the Turkish port of Ceyhan, but exports via that channel dried up in December due to a payment row with Baghdad.

The northern region is now pushing ahead with plans to build its own oil export pipeline to Turkey, despite objections from the United States, which fears the project could lead to the break-up of Iraq.

Yildiz urged Iraq to provide more crude for the Ceyhan pipeline and said Turkey would also support the idea of a new pipeline from Iraq's southern Basra terminal to Ceyhan. (Editing by Nick Tattersall and James Jukwey)

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