Speaking at an airport news conference before his departure, Erdogan revealed an important cooperative venture in northern Iraq. He said, “We have taken a step to begin oil exploration with ExxonMobil, together with the northern Iraq regional administration. We will develop these steps further during my US visit.”
This was Erdogan’s way of saying that the region’s less costly oil and natural gas resources will be available to the world via Turkey, and that the US firm Exxon was cooperating alongside Turkey in this venture. Erdogan noted that the northern Iraq regional administration has a constitutional right to undertake such an action. “It is the right of that administration to cooperate in this action with Turkey,” Erdogan said.
State-owned Turkish Petroleum [TPAO] will be working with ExxonMobil. This joint venture with ExxonMobil has great significance. The following are the main features of this oil and natural gas deal:
● The prime minister is describing northern Iraq’s selection of Turkey as a partner that will receive 17% of oil revenues as something that it is legally entitled to do, and a “most natural right.” By announcing joint exploration with ExxonMobil, Erdogan is telling the US, “Your company is there and we are working together.”
● Erdogan is also telling the Baghdad government, which is unhappy with the Turkish presence in northern Iraq, that “the US is with us.”
● This step means opening up northern Iraq’s vast oil and natural resources to the world. For Turkey it means cheaper access to natural gas and oil resources, only 150-200 km from its border.
● Turkey’s energy costs are too high. Instead of paying an average of $450 for 1,000 cubic meters of natural gas purchased from Russia, Iran and Azerbaijan, Turkey will now be paying $200-250 for this amount.
● With a pipeline, the region’s 3.2 trillion cubic meters of natural gas reserves will be transported to Turkey and via Turkey, to the world.
After Israel’s apology to Turkey, the green light has been given for energy deals in the region. Last week, Turkey’s Energy Minister Taner Yildiz said Turkey was ready to cooperate with Israel and Greek Cypriots in the eastern Mediterranean; we will soon learn about the US role in this cooperation.