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Iraq, KRG await court ruling on tanker

  • Märkte: Crude oil, Oil products
  • 22.08.14

A federal judge in Houston today questioned at what point Iraq lost control of a disputed 1mn bl crude cargo idling off the Texas coast, a key point in whether the court has the right to seize the cargo if it enters US waters.

In a hearing this morning judge Gray Miller pressed attorneys for the Iraqi oil ministry and the Kurdistan Regional Government (KRG) to explain why they each believe they should have control over the oil produced in the northern reaches of Iraq.

KRG insists it controlled the crude when it was produced in Kurdish fields and so the dispute does not belong under maritime law in US courts. Iraq has argued the crude was both illegally produced and taken out of the country's possession on the waters off Ceyhan, Turkey, an action it argues keeps the cargo within court authority under maritime law.

Neither side supports having the court determine who owns the cargo, a question all parties said was best left to decide in Iraq. But KRG has refused to appear in an Iraqi court on questions of production.

"If this court allows this oil to be sold, they're never going to show up to court in Iraq," said Phillip Dye, an attorney for the Iraqi oil ministry.

The judge adjourned the hearing without indicating when he intends to rule.

The United Kalavryta has meanwhile remained in international waters about 60 miles off the Texas coast for nearly a month, outside the authority of the US court. A lightering company successfully exited a contract to unload the tanker after the ownership dispute hit US courts.

LyondellBasell and asphalt refiner Axeon Specialty Products, which previously intended to receive shipments of Kurdish crude, have both now refused to take crude produced in northern Iraq and shipped out of Ceyhan until ownership disputes are settled. A second tanker off the US Atlantic coast, the Minerva Joy, was headed back to the Mediterranean today, based on ship tracking data.

Hungarian integrated oil company Mol took delivery of 586,400 bl of Kurdish crude earlier this week in the Croatian city of Omisalj.

eb/tdf

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