Turkish Forum

Tag: Iraq’s Kurdistan region

  • Iraq Warns Kurds Against Striking Oil Deal With Turkey

    By Palash R. Ghosh

    The central government of Iraq warned the Kurdish-ruled semi-autonomous region of northern Iraq that it must obtain Baghdad’s approval for any oil export deals signed with Turkey.

    Kurdistan Regional Government Natural Resources Minister Hawrami speaks with Turkish Energy Minister Yildiz during a joint news conference in Arbil.

    On Sunday, Iraqi Kurdistan unveiled an agreement to sell oil through Turkey into the international markets, thereby leaving Baghdad completely out of the loop. The Kurdish oil minister Ashti Hawrami said Iraqi Kurdistan will construct a huge 1 million barrel per day pipeline over the next 12 months through which oil and gas will be carried through Turkey.

    “We envisage the building of a new pipeline taking Kurdistan’s oil, particularly the heavier component part to Cihan,” Hawrami said at a conference with Taner Yildez, the Turkish energy minister.

    Baghdad believes such an arrangement contravenes Iraqi laws, while Kurds assert they can sign any contract regarding their natural resources according to the terms of the constitution.

    Since 2003, the Kurds have entered into dozens of gas and oil deals, all of which have been classified as “illegal” by the authorities in Baghdad, who have also blacklisted the companies involved, including Exxon Mobil Corp. (NYSE: XOM), from doing business in Iraq’s southern oilfields.

    “We have no problem with any deals, but they have to be according to the Iraqi constitution and laws that govern relations between Baghdad and the Kurdish region,” said Ali al-Moussawi, an adviser to Iraqi Prime Minister Nouri al-Maliki.

    Earlier, the Kurds and the central Iraqi government entered into a deal under which Kurdistan would transport its oil to Baghdad, which would then sell it on the international market (with each side taking half of the revenue). However, in April, the Kurds cancelled this agreement, citing a payment dispute with Baghdad.

    But Hawrami insisted that there is no distinction between Kurdish oil and Iraq oil.

    “When we say oil from Kurdistan, it’s Iraqi oil,” Hawrami said.

    “There is no difference between Iraqi oil or Basra oil from Kurdistan.”

    A pact between Iraqi Kurdistan and Turkey was inevitable.

    “If you look at Turkey, which is the second-fastest-growing country in the world, its gas needs, which increase significantly every year, and then the price of oil, I think people realize that Turkey is looking to Iraq — particularly the Kurdish regional government — very carefully, because of economics, not because of politics,” Mehmet Sepil, chairman of Turkey’s Genel Energy, told al-Jazeera.

    Iraq is now Turkey’s second-biggest trade partner, although most of that trade is with the Kurdish region.

    According to the Kurdish government, there are about 143 billion barrels of proven oil reserves in the south of Iraq, while the northern (Kurdish) semi-autonomous region has about 45 billion barrels,.

    Meanwhile, any deals with Turkey will likely worsen already tense relations between Ankara and Baghdad.

    Maliki of Baghdad was also outraged recently when Turkey’s Prime Minister Recep Tayyip Erdogan hosted Tariq al-Hashemi, the Iraqi vice president who had been issued an arrest warrant by Baghdad for allegedly forming death squads. Hashemi has since escaped to Iraqi Kurdistan for refuge.

    via Iraq Warns Kurds Against Striking Oil Deal With Turkey – International Business Times.

  • Former BP boss, the ‘Turkish’ conduit and the Zionist Banker

    Former BP boss, the ‘Turkish’ conduit and the Zionist Banker

    Tony Hayward in line for multimillion windfall after Iraq oil deal

    Hayward, who quit BP 14 months ago following the Deepwater Horizon disaster, will be chief executive of Genel Energy PLC, which has oil reserves in Kurdistan (sic.)

    Former BP chief executive Tony Hayward is in line for a windfall after his investment vehicle signed a deal with Turkey's Genel. Photograph: Toby Melville/REUTERS

    Tony Hayward has sealed a deal to exploit the oil fields of Iraq’s Kurdistan region, landing the former BP boss an expected windfall of around £14m.

    Hayward’s return to the oil industry was finalised on Wednesday as his new investment vehicle, called Vallares, agreed a merger with Genel Energy International of Turkey. The deal will deliver an estimated £176m windfall for Hayward and his fellow backers of Vallares, including Nat Rothschild.

    Hayward said the deal would allow Vallares to exploit “one of the last great frontiers in the oil and gas industry”.

    “Arguably, it [Kurdistan (sic.)] is the last big onshore ‘easy’ oil province available for exploration by private companies anywhere in the world,” he added.

    The combined company will be named Genel Energy PLC, and aims to join the FTSE 100 by early 2012.

    Hayward, who quit BP 14 months ago following the Deepwater Horizon disaster, will be chief executive of the combined company, sealing his return to the ranks of major oil firm bosses. On a conference call with reporters he refused to discuss how the transformation of his fortunes over the last year contrasted with the ongoing struggle faced by those affected by the oil spill in the Gulf of Mexico.

    Genel holds proved and probable reserves of 356m barrels of oil. It is well-placed to tap Kurdistan’s (sic.) huge reserves of hydrocarbons, with an estimated 40bn barrels of oil still to be discovered. Hayward compared the region’s potential to that of the North Sea.

    Vallares will issue $2.1bn (£1.3bn) worth of new shares, and use the proceeds to buy Genel in a 50:50 merger that will see the Turkish firm merge with Vallares and take its share listing through a “reverse takeover”.

    Vallares was created by Hayward, Rothschild and two other businessmen earlier this year, raising £1.35bn through a stock market flotation.

    Under the terms in which Vallares was created, the four co-founders will share a windfall worth 6.67% of the group’s value once it has completed its first major deal, in return for injecting a total £100m at its creation. That means the quartet will share around £170m, depending on their original stakes. The split of the £100m was not made public, but Hayward reportedly contributed £8m.

    Mehmet Sepil, the current CEO of Genel, was hit with a record fine of almost £1m for insider trading in February 2010. The Financial Services Authority imposed the penalty after Sepil, and two colleagues, bought shares in Heritage Oil following confidential test results that revealed that Heritage and Genel had made a major oil discovery. Sepil insisted that he had not realised that this breached insider dealing rules.

    Sepil will become president of the new company, but will not serve on its board. Some analysts have questioned whether, given this fine, Genel would have been allowed to list in London with Sepil at the helm.

    City grandee Rodney Chase will chair the company. He insisted on Wednesday that Genel Energy will show “total adherence” to City rules. Chase added that the merger with Genel showed that companies from around the world could be attracted to list in London.

    www.guardian.co.uk, 7 September 2011

    [2]

    The City forgives trespasses – perhaps too readily when money talks

    Only months after Tony Hayward’s near-death experience at BP, he’s back in the oil business

    Julia Finch

    Tony Hayward
    Tony Hayward is in effect using his name in the City to give cover to a chief executive who was fined £1m by the FSA. Photograph: Win Mcnamee/Getty Images

    The City is a forgiving place for those with an aptitude for making money – and losing it. Tony Hayward is set to march back into leadership with a London-listed oil company only months after presiding over a near-death experience for BP.

    The Vallares investment vehicle that Hayward recently established with his financier friend Nat Rothschild has merged with Kurdistan (sic.) oil explorer Genel Energy International of Turkey. Hayward will bring it to market under the Genel name via an initial public offering making paper profits for himself and Rothschild of many millions of pounds each.

    But Hayward is, in effect, using his name in the City to give cover to Genel’s chief executive, Mehmet Sepil. The Turkish businessman was fined nearly £1m by the UK’s Financial Services Authority for insider dealing around an earlier potential – but ultimately unsuccessful – merger of Genel with London-listed Heritage Oil.

    Sepil would probably find it very difficult to bring his company to market himself, so he needs a fine local name to front his business – especially as Genel could soon end up in the FTSE 100 group of leading companies and therefore be automatically included in many workers’ pension funds.

    Outsiders might think that Hayward is not an obvious choice. BP has sold tens of billions of pounds’ worth of assets to pay for the cost of potential liabilities in the aftermath of the Gulf of Mexico blowout. Shares in the company continue to trade some 30% below where they were before the accident 18 months ago and speculation continues that it may need to break itself up to create new value.

    Clearly, Hayward cannot be held solely responsible for the Macondo oilwell disaster. The facts suggest there were very many different parties who played a role.

    But still – like the bankers who have largely got off scot-free in the UK despite blowing up the financial system – it adds to a feeling that the City’s willingness to forgive is inappropriate, if not irresponsible. And it adds to the sense of a race to the bottom among stock markets keen to pull in petro-dollar businesses without much regard for corporate social responsibility.

    www.guardian.co.uk, 7 September 2011