BP brings Turkey’s TPAO into Iraq’s Kirkuk project as Baghdad targets 1 million bpd exports

Baghdad (IraqiNews.com) — BP has agreed to sell a 15% stake in its Kirkuk operating business to Turkey’s state-owned oil firm TPAO, strengthening Ankara’s position in one of Iraq’s major oil reconstruction projects. Baghdad and Turkey have also agreed to work together to increase Iraqi crude exports to 1 million barrels per day. The agreement, announced during Prime Minister Ali Al-Zaidi’s visit to Ankara, comes after BP sold a 42% stake in BP Energy Company of Kirkuk Limited (BP ECKL) to U.S.

oil producer ConocoPhillips earlier this month, leaving BP with a 43% operating interest, ConocoPhillips with 42%, and TPAO with the remaining 15%. The restructured collaboration puts three big international energy corporations in charge of redeveloping Iraq’s Kirkuk oil complex, one of the country’s oldest and most crucial producing areas. BP ECKL is responsible for developing the Kirkuk Development and Production Contract, which includes over 3 billion barrels of oil equivalent from the Baba and Avanah domes of the Kirkuk field, as well as the adjacent Bai Hassan, Jambur, and Khabbaz fields operated by Iraq’s state-owned North Oil Company.

The commercial agreement coincided with broader talks between Al-Zaidi and Turkish President Recep Tayyip Erdogan, who stated that the two countries intend to increase Iraqi oil exports to Turkey to 1 million barrels per day and sign a comprehensive energy cooperation agreement following the expiration of the decades-old Iraq-Turkey pipeline agreement. Iraq’s Kirkuk reconstruction is anticipated to restore production from aging northern oilfields while increasing export capacity via Turkey. After years of outages, Baghdad is working to restore northern crude shipments and expand export channels beyond the Gulf.

The investment also signals Turkey’s comeback as a commercial player in Kirkuk’s oil business almost a century after the Ankara Treaty of 1926, which saw Ankara give up territorial claims over the old Mosul vilayet in exchange for a temporary share of Iraqi oil royalties. Unlike that approach, TPAO’s engagement is based on a commercial venture with BP and ConocoPhillips rather than a sovereign revenue-sharing agreement. Al-Zaidi’s visit to Turkey, his fourth official foreign trip since taking office after stops in Washington, Doha, and Tehran, emphasized Baghdad’s strategy of combining foreign investment in its energy secto…