Iraq, Oil Firms Trade Blame Over Shut Türkiye Pipeline 

A general view of the Kirkuk-Ceyhan pipeline linking Iraq and Türkiye at Türkiye's Mediterranean port of Ceyhan. (Reuters)
A general view of the Kirkuk-Ceyhan pipeline linking Iraq and Türkiye at Türkiye's Mediterranean port of Ceyhan. (Reuters)
TT

Iraq, Oil Firms Trade Blame Over Shut Türkiye Pipeline 

A general view of the Kirkuk-Ceyhan pipeline linking Iraq and Türkiye at Türkiye's Mediterranean port of Ceyhan. (Reuters)
A general view of the Kirkuk-Ceyhan pipeline linking Iraq and Türkiye at Türkiye's Mediterranean port of Ceyhan. (Reuters)

Foreign oil firms operating in Iraq's Kurdistan region are partly to blame for the delay in resuming crude exports after failing to submit contracts for revision, Iraq's oil ministry said.

The Iraq-Türkiye oil pipeline (ITP) which once handled about 0.5% of global oil supply has been halted, stuck in legal and financial limbo, since March 2023.

The flows were halted after the Paris-based International Chamber of Commerce in a longstanding arbitration case ruled Ankara had violated provisions of a 1973 treaty by facilitating such exports without the consent of the Iraqi federal government.

Iraq's oil ministry in a statement published late on Sunday noted that foreign companies, alongside the Iraqi Kurdish authorities, have still not submitted contracts for revision to the ministry.

The government is seeking to revise such deals after a court ruled ones signed with the Kurdistan Regional Government (KRG) were invalid, it said in response to a statement on Saturday by the Association of the Petroleum Industry of Kurdistan (APIKUR).

Iraq's federal court in 2022 deemed an oil and gas law regulating the Kurdistan region's oil and gas industry as unconstitutional.

Iraq owes Türkiye minimum payments as long as the pipeline is technically operational - estimated by consultancy Wood Mackenzie at around $25 million per month. APIKUR has cited a similar figure saying it understands Iraq owes $800,000 in daily penalties.

APIKUR said the government of Iraq had not "taken the required actions" to reopen ITP, adding that "there has been no real progress" to reopen ITP despite meetings in Baghdad in January between representatives of the Iraqi government, the KRG and international oil companies.

APIKUR said its member companies' "current commercial terms and economic model must be maintained" and called for payment assurances for past and future oil exports.

Iraq's Prime Minister Mohammed Shia al-Sudani is due to meet US President Joe Biden in Washington on April 15 to discuss the future of the US-led coalition in Iraq, as well as Iraqi financial reforms and a US push to wean Iraq - a rare ally of both Washington and Tehran - off Iranian power and gas.

APIKUR said it had conveyed to members of Biden's administration and Congress that the White House should not proceed with the planned visit unless flows through ITP resume, international oil firms get payment assurances and the Iraqi government fully implements the Iraqi federal budget for the KRG.

Responding to a Reuters request for comment, a US State Department spokesperson said the US government "encourages all parties to reach an agreement to resume the flow of oil through the Iraq- Türkiye pipeline as soon as possible."

"Restarting oil exports through the Iraq-Türkiye pipeline would be beneficial for all parties," the spokesperson said.



Israeli Defense Company Elbit Q1 Profit Rise on Gaza War Demand

A soldier installs an Israeli flag on a tank during a military drill near Israel's border with Lebanon in northern Israel, October 26, 2023. (Reuters)
A soldier installs an Israeli flag on a tank during a military drill near Israel's border with Lebanon in northern Israel, October 26, 2023. (Reuters)
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Israeli Defense Company Elbit Q1 Profit Rise on Gaza War Demand

A soldier installs an Israeli flag on a tank during a military drill near Israel's border with Lebanon in northern Israel, October 26, 2023. (Reuters)
A soldier installs an Israeli flag on a tank during a military drill near Israel's border with Lebanon in northern Israel, October 26, 2023. (Reuters)

Israeli defense electronics firm Elbit Systems reported higher first-quarter profit on Tuesday as demand from Israel's military in fight against Hamas in Gaza boosted revenue.

One of Israel's largest defense contractors, the company posted earnings of $1.81 per diluted share excluding one-time items versus $1.78 a year earlier.

Revenue rose by 11.5% to $1.55 billion from $1.39 billion.

Elbit's board declared a first-quarter dividend of $0.50 per share.

The company predicts it will meet its revenue target earlier than expected, CEO Bezhalel Machlis told Reuters.

"Our internal goal was to reach $7 billion by 2026," Machlis said. "I can tell you it will be much earlier."

Machlis said there is a "growing demand in defense spending around the world" and that Elbit's portfolio "is very relevant".

"The fact that our systems are in operational use in Israel helps us because customers prefer to get mature solutions," Machlis said, without divulging which countries had expressed increased interest citing "security limitations".

The company supplies hundreds of products to Israel's Defense Ministry, which Machlis said includes simulators, unmanned aerial vehicles (UAVs), artillery, munitions, control systems, communications, high powered lasers and others.

Elbit's Tel Aviv listed shares were down 1.1% at midday and are down 7.4% this year.