Ankara: Economic expert Nabil Al-Marsoumi stated today, Monday, that Turkey’s decision to terminate the oil export pipeline agreement with Iraq is based on Article (11) of the amended agreement dated September 19, 2010. This article allows either party to terminate the 15-year agreement by providing written notice one year before its expiry.

According to National Iraqi News Agency, Al-Marsoumi clarified in a Facebook post that Iraq had the opportunity to request a modification or extension of the agreement two years prior to its expiry but failed to do so, as specified in the same article.

He further noted that Turkey’s decision might also be a reaction to the arbitration lawsuit filed by Iraq against Ankara in the International Chamber of Commerce in Paris, which ordered Turkey to pay $1.5 billion in compensation for exporting oil from the Kurdistan Region without Baghdad’s consent.

Al-Marsoumi suggested that the more likely motive behind Turkey’s move is its intention to establish a new pipeline to transport oil and gas from Basra to the port of Ceyhan, passing through Haditha, Baiji, and Fishkhabour, and ending in Silopi in southern Turkey, with a capacity of 2.2 million barrels per day.

He added that the new project has the approval of the Iraqi government, as it serves as a strategic alternative for Iraq’s oil exports and forms an extension of the ‘Development Road’ project that aims to link Asia to Europe. It also fits within Turkey’s broader plan to become a regional energy hub.

Al-Marsoumi further explained that the project includes laying a gas pipeline from Basra to Silopi, to temporarily supply Iraq with Turkish gas for electricity generation, until local gas fields are developed.

He warned that the halt of the Ceyhan pipeline poses a severe economic blow to the Kurdistan Region, as it is the only outlet for Kurdish oil exports. This, he said, will make the region more dependent on Baghdad in the near future.

Earlier today, Ankara announced that the crude oil pipeline agreement signed with Iraq in 1973 and enforced in 1975, along with all subsequent protocols and memoranda, will be terminated starting July 27, 2026.

This decision comes as preparations are underway to resume the export of oil from the Kurdistan Region, which has been suspended for around 28 months via the Ceyhan port.

Turkey had halted Iraqi oil exports through Ceyhan in March 2023, following a ruling by the International Chamber of Commerce that ordered Ankara to pay $1.5 billion to Baghdad for unauthorized exports between 2014 and 2018.

Iraq had filed the arbitration case in 2014 over Turkey’s role in facilitating oil exports from the Kurdistan Region without the approval of the federal government in Baghdad.