Monday, January 20, 2014

Kurdistan Goes it Alone



by Ranj Alaaldin


Iraq’s Kurds have taken another step toward independence with the creation of a pipeline that will give them an independent export capacity. Over the past five years, the region has dramatically transformed its oil and gas sector, both to enhance its autonomy from the rest of Iraq and to build on the stability and prosperity it has enjoyed post-2003.

The Kurdish position, put forward last month in Erbil at the Kurdistan–Iraq Oil & Gas Conference, which I attended, is simple: Kurdistan will not allow itself to be shackled by Arab Iraq’s turmoil and dysfunctional politics. Nor will it allow a return to the past, when the Kurds suffered under dictatorship and the centralization of power. With or without Arab Iraq, Kurdistan will move forward.
The pipeline connecting Kurdistan and Turkey means that the former can start exporting its oil to the latter, and then on to international markets, in an efficient and sustainable manner, thus allowing it to maximize on its oil and gas reserves. This is a marked change from the past, when Kurdistan could only send its oil to Turkey by truck, as Baghdad controlled the national pipeline. Tried and tested, the Kurdish pipeline will export up to 350,000 barrels of oil per day in 2014, which could rise to 2 million barrels per day in the coming years.

How sustainable this arrangement is and how far the Kurds’ autonomy goes depends on the Kurds’ relations within Iraq and with the rest of the region. The most unlikely of regional powers helping it to take the region forward is Turkey, which has put its full support behind the Kurdistan Regional Government (KRG) and its efforts to become an international hydrocarbons player.

For decades, the Turkish state suppressed Kurdish rights within its own borders and waged war with the Kurdistan Workers’ Party, the Kurdish rebel group that has fought the Turkish state for thirty years in search of a combination of political, territorial and human rights for Turkey’s marginalized Kurds. Historically, Ankara has feared and suppressed the ascendancy and autonomy of the Iraqi Kurds, lest it encourage Turkey’s own restive Kurdish population to push for similar rights.

Times have changed. Turkey has given up on Arab Iraq in many respects. Instability and sectarian conflict, exacerbated by the civil war in Syria, means that it will be some time before Iraq can fulfill its economic potential and maximize on its colossal oil and gas reserves.

Ankara believes Baghdad is too far into the orbit of Iranian influence for it to give up on the Kurds and develop a closer strategic relationship with Baghdad. Iraq’s Kurds constitute a useful counterweight against Iranian influence, and they are important allies in a volatile Middle East. Ankara also sees the Iraqi Kurds as useful allies in an uncertain and unstable Syria.

While stronger KRG–Turkey ties may further undermine Ankara’s relations with Baghdad, they would not necessarily have to eliminate ties completely. Differences can, in fact, be reconciled, and have been before. Further, economic ties between Turkey and Iraq remain strong, despite recent differences. Turkish companies are important players in Arab Iraq and receive some of the biggest and most lucrative contracts.

Politics in Baghdad are also likely to remain so fluid and volatile that it will be difficult for the Kurds’ Arab counterparts to form a unified front on the Kurdish energy issue. At the same time, neither are they likely to present a unified or tough stance on relations with Turkey. Kurdish hydrocarbon revenues will be distributed to the rest of Iraq on a per capita basis, and the Kurds remain important players in Baghdad’s politics. They are likely to once again influence the shape of the next Iraqi central government come parliamentary elections later this year, and their Arab counterparts will look to them for support.

Turkey, on the other hand, will remain an important regional player that cannot be ignored by Baghdad. The matter is predominantly one of economics. Turkey will permit pipeline exports regardless of Baghdad’s opposition, since it desperately needs a reliable source of energy to fuel its economic growth and decrease dependence on other suppliers. A recent agreement on gas exports between Turkey and the KRG, which paved the way for pipeline exports, includes a commitment on the part of the Kurdistan Region to provide 20 billion cubic meters annually to Turkey, which will meet half of Ankara’s current demand, at a price that undercuts existing suppliers.

This article was originally published in The Majalla.



Ranj Alaaldin is a Senior Analyst at the Next Century Foundation, a policy-making think-tank that works in conflict zones.

Source: http://www.aawsat.net/2014/01/article55327246

Copyright - Original materials copyright (c) by the authors.

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