According to a person acquainted with the matter at hand, the Iraq Oil Ministry’s production agreement with the Kurdistan Regional Government (KRG) has not helped resolve their U.S. court dilemma regarding a tanker with crude oil which has been lingering off the Texas coast since July.
The tanker United Kalavryta, which was carrying a million barrels of Kurdish crude, was sent to sea before the agreement was signed on December 2nd. After meeting behind closed doors in Houston with U.S. District Judge Gray Miller, which took place yesterday, Hal Watson, the KRG’s lead lawyer, did not wish to comment on whether or not the Kurds will continue their efforts of bringing the stranded cargo into the US. Jim Loftis, who is the leading Iraq lawyer, said that there was a discussion between him, the judge and KRG’s attorney regarding the agreement.
The Iraqi central government has been making attempts towards seizing the $100 million cargo of the United Kalavryta, for more than four months, in order to negate a scenario in which KRG would crack oil markets in the U.S.. Energy companies have displayed a fair share of reluctance to accept oil claimed by Iraq to have been exported from Kurdistan without its consent.
The tanker itself has been circling a tracking buoy about 60 miles off Galveston, Texas, patiently waiting to receive a final decision. In accordance to VesselFinder tracking reports, the location and draft of the ship have remained unchanged as of December 2nd.
Loftis said that the lawyers were asked by the judge to update him on their dispute ‘s status after a week or so. Watson did not comment on whether or not a deal had been reached regarding the tanker.
Kurdistan is recognized as being part of Iraq by the U.S. government so the U.S. has tried to keep a status of a neutral side. The Oil Ministry cited the Iraqi Constitution by which is stated that all oil resources belong to the Iraqi people.
KRG has expressed its view on the matter by saying that Kurds have the right to make complete use of their own oilfields in order to provide funding for their independence struggles and their fight against Islamic State militants that are trying to take control of the region.
Iraq, which suspended billions of dollars last year in payments owed the KRG for oil royalties and war reparations, has taken a softer approach and agreed on December 2nd to forgo some payments and give permission to the Kurds to export up to 550, 000 barrels a day via Turkey as Safeen Dizayee, a KRG spokesman, commented on the phone.
According to a statement made by Iraqi Prime Minister Haidar Al Alabadi’s office, the production-sharing compromises place 250, 000 barrels of the above-mentioned daily amount under the supervision of the Iraqi central government.