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Turkey aims to boost Iraqi border crude imports 

ISTANBUL, Feb 7 (Reuters) - Turkey plans to raise the volume of Iraqi crude it trucks over the border from Kurdish Iraq this year by more than 50 percent, Turkish officials said on Thursday.

Ankara aims to take four million tonnes or 80,000 barrels a day of Iraqi Kirkuk crude, compared to 2.6 million tonnes, 50,000 bpd, last year, said Husamettin Danis, the general manager of largely state-owned refiner Tupras.

The trade, outside Iraq's oil-for-food deal with the United Nations, is carried out by Turkey's foreign trade undersecretariat, for refining by Tupras (TUPRS.IS).

Officials said truckers also were bringing in around 15,000 tonnes of diesel a month into the country, also trucked in from northern Iraq.

Strictly speaking, both forms of fuel trade with Iraq are breaches of U.N. Gulf War sanctions on Iraq, in place since 1990, but Turkey's Western allies turn a blind eye to the business.

The United States and Britain hope to put a stop to the trade with a change in the sanctions regime that would eliminate smuggled oil sales that provide cash direct to the government of Iraqi President Saddam Hussein.

"Around 100-120 vehicles are going through a day. We haven't had any problems for a month," Huseyin Baskaya, governor of the border province of Sirnak, told Reuters of the diesel trade.

Turkish truckers take supplies of food or household products into northern Iraq, where they buy diesel from local Kurds for sale in Turkey at below market prices. The Kurds get their supplies from the Iraq government.

That business resumed on January 7 after Iraq halted supplies to the Kurdish faction which runs the diesel sales in northern Iraq, which has been outside Baghdad's direct control since after the 1991 Gulf War.

NO OIL-FOR-FOOD TRADE

Baskaya said an average of 100 trucks meant around 500 tonnes of diesel a day entering Turkey, for around 15,000 tonnes a month.

A separate trade in crude oil in larger tankers is carried out for Tupras, bringing crude in from the Iraqi government-controlled oil centre of Kirkuk.

While the diesel trade is run by individual truck drivers who buy fuel from the Kurdistan Democratic Party (KDP) in northern Iraq, the crude is bought directly from the Iraqi government.

Tupras plans to import a total of 21.3 million tonnes (425,000 bpd) of crude this year.

Tupras for several years imported up to 80,000 bpd of Iraqi crude through the U.N.-monitored oil-for-food programme but stopped purchases under the scheme last year. Under the programme, proceeds go to a U.N. account for the provision of humanitarian supplies to Iraqi civilians.

Baskaya acknowledged that problems with the truck shipments of crude over 2001 had undercut planned volumes.

"There are reasons to do with insufficient border personnel in summer months and other border gate problems behind the fact that crude inflow is insufficient," he said.

"But the important thing was the fact that the crude transport tender wasn't carried out in time. The tender period from May to September had a real impact on inflows. Additionally, problems in the northern Iraq region had an impact. There were times when flows were interrupted," he said.

Tupras' Danis said at the weekend that the company had lost $120 million through problems in the crude traffic.

"The Foreign Trade Undersecretariat gave us a four million tonne programme in 2001. But the (transport) firms the undersecretariat picked only produced 63 percent of that, around 2.6 million tonnes," Danis said.

Baskaya said 2002 would be smoother, unless the United States extends its "war on terrorism" to Iraq.

"Unless something extraordinary happens, Tupras will get the four million tonnes it targets through the Habur gate this year," Baskaya said.

But conflict in Iraq would cause Turkey to stop all diesel and crude trade, he said.


 
 
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