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Iraq expels Turkish TPAO in sign of escalating tensions

7 November 2012 16:02 (UTC+04:00)
Iraq expels Turkish TPAO in sign of escalating tensions

The state-owned Turkish Petroleum Corporation (TPAO) has been expelled from an oil exploration deal in Iraq's oil-rich Basra region as the tensions between the two countries have started to take toll on blossoming commercial ties, Today`s Zaman newspaper reported.

"The cabinet decided to exclude the company TPAO from Block 9," Abdul Mehdi al-Amidi, head of the Oil Ministry's contracting and licensing department, said, according to AFP news agency.

The report quoted him as saying that the exploration contract included provisions allowing companies' shares to be sold on to others, and raised the possibility that "Kuwait Energy will get the Turkish share, and the new consortium could be 70 percent from Kuwait, and 30 percent from Dragon Oil."

Together with Kuwait Energy and the UAE's Dragon Oil, the TPAO won the rights to explore a 900-square-kilometer (350-square-mile) area in the oil-rich Basra province this May. The consortium would be paid $6.24 for each barrel of oil equivalent it finds. The tender yielded the fifth contract for the Turkish company in Iraq.

The report noted that Amidi did not comment on why TPAO was expelled.

The decision came two days after Iraqi Prime Minister Nouri Al-Maliki reached out to Turkey to restore soured relations and said that the war-torn country is ready to establish peace with Turkey if Ankara ceases to interfere with Iraq's internal affairs and repatriates its fugitive vice president.

"We will be pleased to see the presence of Turkey and Turkish companies in Iraq if Ankara respects Iraq, doesn't interfere in our domestic affairs, doesn't violate Iraq's air space," Maliki stressed.

Relations between Turkey and Iraq have become strained over a number of issues, both political and economic. Most recently, Ankara angered Baghdad by declaring that it would not extradite fugitive Iraqi Vice President Tariq al-Hashemi after he was sentenced to death on charges of running death squads. The two countries are also at odds over a recent deal between Ankara and the Iraqi Kurdish administration allowing the Iraqi Kurds to export oil and gas through Turkey.

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