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Iraq has halted crude exports to South Korea's SK
Energy over Kurdistan oil deals
28.1.2008
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South
Korea's SK Energy feels heat over Kurdistan oil
deals
January 28, 2008
Baghdad, Iraq, -- Iraq has halted crude
exports to South Korea's SK Energy in protest over
an oil deal - which it claims is illegal - struck
between South Korean companies and the Kurdistan
regional government, Iraqi oil ministry sources
said.
Baghdad has long maintained oil deals that
international companies have signed with the
semi-autonomous Kurdistan Regional Government (KRG)
in 'northern Iraq' are illegal.
Iraq has warned more of its crude buyers that they
must back out of deals with KRG if they want to
continue receiving exports, one ministry source told
Reuters. |
South Korea's SK Energy |
"There are others we have warned," he said,
declining to give further details.
"We will not deal with any company that has signed
contracts with the KRG without the consent of the
central government of Baghdad."
Baghdad suspended a contract to export 90,000
barrels per day to refiner SK Energy on 1 January
and has given the company until 31 January to back
out of the deal if it wants exports to resume,www.ekurd.net
the
sources told the news agency.
"If they disassociate themselves from the deal then
it will be fine," one source said. "But otherwise
they are not going to receive a drop of oil."
For now, Baghdad has allocated no crude to SK for
2008, he added.
The exports account for about 4% to 5% of South
Korea's oil imports, a South Korean energy ministry
official said.
"We have been expecting this, we are not too
surprised," the official told Reuters.
SK was likely to choose developing the oilfield in
the Kurdish region above resumption of oil imports,
another official said.
The country was covering for the lost imports by
buying crude in the spot market but the halt had
caused a problem for February supplies, the official
added.
An SK spokesman declined to comment.
A consortium of South Korean companies led by
state-run Korea National Oil Corporation and
including SG secured exploration rights from KRG for
the Bazian oilfield in the Duhok region of Kurdistan
region 'northern Iraq'.
Among other international companies that have signed
up for deals with the KRG are Austria's OMV and
Hungary's MOL.
Reuters |
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